UK: IT'S ALL IT TO ME. - Given that so many top executives speak a different language from their technologists, it is little surprise that returns on IT investment are often so disappointing.

by Jane Bird.
Last Updated: 31 Aug 2010

Given that so many top executives speak a different language from their technologists, it is little surprise that returns on IT investment are often so disappointing.

Back in the dim dark ages of the '80s, when SG Warburg used to set up meetings so that its top bankers could specify their strategic IT needs to company technologists, the only finance people the company could persuade to attend were the investment bank's rawest trainees. So minimal was the interest in what technology had to offer that everyone else could always find something they regarded as more important to do.

With such IT illiteracy in mind, Management Today, together with Computer Associates, a leading US-based software company, commissioned market research company MORI to discover whether in the Internetted and Webbed-up '90s, top executives now show more interest in their company's IT strategy.

The research was also designed to discover whether IT managers now feel their employers are getting the maximum benefit from computer-based technology (see following article for findings).

Computer Associates founder and CEO Charles Wang argues that an acute misunderstanding between business managers and technologists still exists even if your average CEO has worked out that a desktop is not just a place to dump unwanted papers. The problem, says Wang, is that business executives talk about customers, services, global competition and return on investment while IT people seem fixated on computers, network architectures and leading-edge software techniques. 'Too often they fall in love with a technological innovation that has no practical use in the real world.'

Wang terms the problem a 'disconnect', with severe consequences for business. He sees it as largely responsible for the widespread disenchantment with IT and the fact that such technology has often had such a disappointing effect on profitability. In the case of large corporations, he argues, the disconnect means many lost opportunities; for smaller companies, it can threaten their very survival. And, he claims, the problem will get worse as competitors learn to use IT as a strategic enabler, as First Direct or Direct Line, for instance, have learned to use technology to offer traditional services in a radical manner.

Where a disconnect exists, eliminating it is the responsibility of the CEO, says Wang. Company chiefs have to recognise that they need to know enough about technology in the same way that they might need to know the basics of company law, marketing or production. For once a CEO abdicates responsibility and lets technical people drive IT, they will, says Wang, turn it into a research exercise, use it as an argument for investing in more equipment or insist on reinventing the IT wheel.

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