 
  See your link here
|
For more info on a specific newsletter, click the title. Details will be displayed in a new window.
Subscribe to
Computerworld 40 years of the most authoritative source of news and information for IT leaders.
BONUS LINKS
| Talent Management
Talent management solutions to assess, engage, develop your workforce |
The End of Corporate IT? Not Quite
or
Other Management Stories
|
|
|
|
June 20, 2005 (Computerworld) --
When Nicholas G. Carr famously asserted that "IT doesn't matter" in 2003, he backed up his thesis with data gathered by IDC and Orlando-based consulting firm Alinean Inc. After Carr's recent prediction of the end of corporate IT , Alinean CEO Tom Pisello told Computerworld's Kathleen Melymuka that continued research has raised some very interesting findings about the relationship of IT spending and business success.
Is Nicholas Carr on to something in touting the end of corporate IT? Carr's claim that IT has become a commodity utility has fueled a two-year debate on whether technology investments deliver competitive advantage. On one hand, we agree that corporate IT often spends too much to "keep the lights on." Most companies invest more than 65% of IT budgets on basic infrastructure like PCs, servers, e-mail and storage.
But it's important to differentiate between infrastructure investments and strategic investments. Strategic IT investments, especially when closely aligned with business goals, prove that technology can deliver a competitive edge.
What do the numbers say? Tell me what the Alinean/IDC pre-2003 research showed about IT spending and corporate performance. IT spending and performance research have to be examined in context with the market. When Carr used our 2003 research in his original Harvard Business Review article, market conditions were really tough. Back then, we found that top-performing companies, or those with the highest Economic Value Added, were notably frugal with IT dollars. These high performers were spending less than 1% of overall revenue on IT, while the average company spent 3.7% and the laggards were spending 2.7%.
And continued research shows essentially the same thing, right? Yes, top-performing companies continue to be more frugal in their IT spending, spending 0.5% less on IT as a percentage of revenue versus the average company. But the spending gap has narrowed significantly.
Alinean CEO Tom Pisello
What's the significance of this finding? Leaders are incredibly agile with spending. In contrast, average companies and laggards have held IT investment relatively constant, averaging 3.7% and 2.7%, respectively, over the past three years.
Also, when you look at IT spending per employee, the picture changes. Tell me about that. Interestingly, leaders spend more per employee on IT than an average company—in fact, about $500 more each year. IT investments help these companies do more with fewer people, or better manage outsourcing initiatives.
|
Print this Story |
|
Send Us Feedback |
|
E-mail this Story |
|
Digg this Story |
|
Slashdot this Story |
|
|
|
|
|
 |
| All Zones Application Performance Zone Business Continuity Zone The File Data Management Zone Security Management Zone ITIL Best Practices Zone The SAS Zone Business Intelligence and Analytics Zone Windows Protection Zone Identity & Security Management Zone |
|
See your link here
|
 |
||||||||
| ||||||||
| ||||||||
| ||||||||
|
Google's Universal Search for Business 
Download this Computerworld Executive Briefing, a $195 value, for free! Compliments of Akamai. 
Get this white paper now!
Read up on the latest ideas and technologies from companies that sell hardware, software and services.
- At 10, Google reiterates commitment to CIOs
- iPhone 3G owner sues Apple, AT&T over dropped calls, app crashes
- Microsoft explains Seinfeld-Windows TV ad: just a 'teaser'
- More top stories
|
Seinfeld's Windows TV ad Anonymous wrote: So, Microsoft (and its ad agency) have a major "shrinkage" problem! [read the story | have your say] Hot topics now: |
Intercept Spam & Viruses With MessageLabs MessageLabs is offering a complimentary 30 day trial of its managed Anti-virus and Anti-spam security solutions. MessageLabs guarantees complete protection against all know and unknown email threats. By providing 24 hour support, your business can increase productivity and decrease risk. Register for a complimentary trial and receive a free datasheet.Download this white paper now!
|
|
Do you love where you work?
Tell us about it!  Nominate an organization today for Computerworld's 2009 Best Places to Work in IT list.
Nominate a company here.
See the 2008 Best Places to Work in IT report
|
| SQL Anywhere Developer Edition Download SQL Anywhere is the industry-leading mobile and embedded database. Designed for database-powered applications that operate in frontline environments without onsite IT support, SQL Anywhere offers enterprise-caliber features in a database that is easily embedded and widely deployed in server, desktop, remote office and mobile applications. Download the free SQL Anywhere Developer Edition
|
