Original URL: http://www.theregister.co.uk/2005/02/03/telewest_it_spending/

Bosses cool on IT spending

ICT ROI, OK?

By Tim Richardson

Posted in CIO, 3rd February 2005 11:42 GMT

Fewer UK bosses are planning to increase their IT budgets compared to last year, according to research conducted by the Economist Intelligence Unit (EIU) on behalf on Telewest. Just 43 per cent of senior execs plan to boost their ICT budgets in 2005, compared to 58 per cent last year.

This slip in confidence stems from continued boardroom scepticism about the value of ICT projects. While bosses can see that IT works, they also want to be able to measure what they get out of their investment.

Although they are aware of the benefits of technology, they also want to see "plausible evidence" that their investments are increasing productivity and helping to deliver increased profit.

According to the research, 12 per cent of UK execs and a quarter of business managers do not think that their ICT networks are cost-effective. While nine in ten said that companies should require "budgetary justification" prior to any IT spend.

There also appears to be a divide between business leaders and CIOs. Two thirds of chief execs feel that technology usually under-performs against expectations, while a similar proportion of CIOs disagree.

John Cunningham, head of Business Services at Telewest Business, reckons there is still a "long way to go to consolidate the two parties. Business and technology executives are still having trouble agreeing on the success of ICT projects, but investments need to be made to maintain competitive edge," he said. ®

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