Penny Wise and Pound Foolish

As published in 'Digital Leaders 2014' IT Strategy Guide by BCS The Chartered Institute for IT as part of a set of 200-word insights from BCS ELITE Committee members.

 

Where Does All The Money Go?

Steve Burrows <This email address is being protected from spambots. You need JavaScript enabled to view it.>

Vice Chair, BCS ELITE

 

Almost any CFO will tell you that IT is expensive. Almost any IT Director will tell you that he is under pressure to reduce IT costs.

 For the past decade IT leaders have been pressured to reduce the cost of IT without reducing its benefits. Cost reduction has been the path to improved ROI from IT. Most IT leaders will confess that this pressure has inhibited business IT innovation. There has been technological innovation – necessary to reduce costs – but business innovation has been sluggish at best. The enablement which IT brings to business and workers has not generally increased in the past decade and the contribution of IT cost reduction to improving ROI has stagnated.

The potential benefits of IT are clear; improved information exploitation, communication & collaboration, and worker enablement. The value of gains in these areas demonstrably outweigh the benefits of cost reduction. The value of each innovation is multiplied by the number of businesses and workers who exploit it. It is time to stop trying to cut the costs of IT and instead ask how we can spend our money to enable more people to do better things. The great IT leaders of the future will be those who provide great customer service in delivering worker and organisational enablement.