Businesses ‘paralysed’ by democratic IT

The "democratisation" of IT within European businesses has paralysed decision-making, according to senior IT personnel interviewed for a new survey.

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The "democratisation" of IT within European businesses has paralysed decision-making, according to senior IT personnel interviewed for a new survey.

This was despite IT decision-makers across Europe overwhelmingly recognising the need for modernisation, according to the research among 234 large companies in the UK, France, Germany and Italy with over 1,000 employees. The Pressure Point Index survey was conducted by research firm Penn, Schoen & Berland Associates on behalf of IT firm HP.

Middle managers in many companies have begun to exert more control than ever over IT decisions made within their individual departments, according to the report, eroding the influence of chief information officers. This was providing optimum departmental results, but resulted in substantial cost and complexity for businesses overall, it said.

An executive in the UK who was surveyed for the research said one of the greatest challenges to moving away from a stumbling IT department was “persuading senior management of the importance of modernisation before it is too late”, while another highlighted senior management’s fear of change. An executive in Germany said it was important for the IT department to "prove with numbers" how a change would help.

An alarming 82% of executives questioned for the survey felt that too many stakeholders and influencers, including external consultants, were preventing businesses from having a coherent applications strategy. Nine in 10 said a coherent strategy would enable them to manage change within their applications environment, as well as provide them with a clear understanding of how the applications environment should look.

Over three-quarters of companies admitted to lacking an effective applications strategy, despite the fact that 94% recognised the importance of a clear and common applications plan. 84% believed web-based applications would have a great or fair impact on their company’s application structure, but were concerned about the associated security risks.

HP said that the role of the CIO in leading IT strategy within an organisation was more crucial than ever in ensuring enterprises avoided risking chaos. But a number of major firms now exist without a permanent CIO, including retailer Boots, which chose not to replace IT director Rob Fraser when he left last August, and Tesco, which continues to operate with operations development director Mike McNamara filling in after CIO Colin Cobain resigned two months ago.

David Concordel, marketing and strategy director at HP Services EMEA, said: “With more stakeholders involved in IT decision-making it is more critical than ever for the CIO to lead and develop an applications strategy.

“This can govern the selection of new applications and can ensure that the needs of middle managers are addressed while at the same time maximising the return on IT investments.”

An additional finding of the survey was that 75% of businesses were still using mainframes, in spite of widespread awareness of the need for IT modernisation. While 57% of those businesses intended to move away from mainframes in the future, they said cost and senior management’s resistance to change were perceived as the main barriers.

Ian Miller, director of application services EMEA at HP, said there was often a clear business case for the modernisation of the applications environment. The re-hosting from a mainframe to open systems, he said, could enable a 70% reduction in total cost of ownership.

“This lowers the operational costs, releases budget needed for further IT modernisation projects and moves the organisation towards a more flexible IT environment,” he explained. “IT is too important an asset to organisations not to have effective leadership.”

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