Cliff Hobbs - FAQShop.com, The Windows Management User Group & myITforum.com

Microsoft - IT takes a backseat at the boardroom table

Less than half of businesses have IT representation at boardroom level.

23^rd July 07, Reading, UK - Recent research commissioned by Microsoft Ltd has revealed that IT is perceived as less of a strategic asset in bigger companies. The Research conducted by Loudhouse found that only 47% of businesses have IT representation at board level with this number falling to 44% in businesses with 1000+ employees.

The research unveils a level of discord between the perception and reality of the IT role and its function within a business. It reveals that, although IT is not seen as a strategic business asset, 83% of IT Directors acknowledged that application performance problems have a direct impact on their businesses, with 76% acknowledging that delays in bringing new applications to the business causes difficulties.

Although 37% of large enterprises cite better business/IT alignment as a key priority for current IT strategy, there is a prevailing view that companies are failing to convert this into a reality, which is compromising technology’s impact on business. This is leading to a sense of ‘mal-alignment’ which is causing a barrier to organisational success. Matthew Dunstan, application platform group manager at Microsoft UK says “the bridges that exist between business and IT form a critical framework for the strategic success of a company.  Better alignment of IT and business strategy equates to better operations, better visibility and better communication between the functions of an organisation.  People create and run companies, but applications link them together. If people aren’t factoring this into the company at a board level, these ‘business bridges’ are doomed to collapse.”

The synergies between application strategy and business performance are evident throughout the research. Jon Collins, co-author of The Technology Garden – Cultivating Sustainable IT-Business Alignment, recognises the influence of one upon the other by saying “It is abundantly clear that alignment is not treated as a priority when it comes to setting and delivering on IT strategy. In our own research we have found that companies that see IT as a business enabler are better able to respond to change and reap greater benefits than those who still view IT as little more than a cost centre.”

Results of the Research:

Business ‘Malignment’

• Only 37% of large organisations cite better business/IT alignment as a key priority for current IT strategy

• 47% of businesses have IT representation at board level, falling to 44% in businesses with 1000+ employees 

Isolated Infrastructure

• 83% of businesses acknowledge that application performance problems have a direct impact on the business, with 76% acknowledging that delays in bringing new applications to the business cause difficulties

• 52% of respondents are satisfied with the strategic impact that IT has on the business, but only 35% are satisfied with the amount of time it takes to develop new applications and introduce them to the business.

• Just 16% of IT departments believe that the user experience is currently a critical component of application development

• Looking ahead, 36% have planned to improve user experience in future project

• Only 27% of businesses state that they have full automation and monitoring in place for core business applications.  A 7% minority of IT pros have ‘end-to-end’ visibility of the way documents move through their organisation

• 53% of respondents view technology as a strategic asset within the business whilst the other 47% are less positive, believing that IT is perceived only as a cost centre by the board

Conclusions

Conclusions from the research are based on the following three areas:

• Business alignment with IT is something overlooked by many large UK organisations, despite the evident commercial needs that demand a closer working rationale between the two areas. The risk is that strategic goals are undermined if alignment between technology and other business functions is not achieved.

• Organisations that champion technology as a strategic function of business and take a measured approach to infrastructure innovation reap the rewards of a more inclusive approach towards technology.  These businesses experience:

• Greater focus on end user and customer value within applications development
• Better connectivity of disparate technology applications and services
• Wider satisfaction in supporting the organisation to achieve strategic and operational goals

• Most IT functions live outside the fully aligned, integrated and highly appreciated world of technology best practice and the question remains as to what comes first; great organisational management, or great IT strategy?  However, whilst continuing to champion the strategic importance of technology as an asset to the business, getting applications strategy right in the first instance is a logical step in bringing about wider strategic change.