PracticePeople In PracticeBusinesses failing to manage IT assets

Businesses failing to manage IT assets

British business is losing up to £17bn a year by failing to manage IT hardware and software, according to a KPMG study published today.

Recent estimates from the US suggest that between 10% and 40% of overall IT costs can be saved by effective procurement and management of hardware and software – but the study found this issue is not being addressed.

The firm’s survey of 200 finance directors, managing directors and senior managers across UK business found almost half have no idea how much their annual IT budget is. Moreover, 80% did not know what cost savings they may be making from management of IT assets.

‘For many firms IT assets represent their [firms] main area of capital expenditure,’ the report said.

‘The failings are almost universally caused because the organisation does not have an IT asset mangagement policy agreed at board level – and therefore IT management does not have a budget to carry out this work.’

KPMG’s key reason for waste include:

  • ‘Renegade’ purchasing outside the authorised IT budget;
  • Lack of any managerial accountability for the area;
  • Bureaucratic and complex procurement processes;
  • Failure to consider the question at board level.

Paul Diamond, KPMG’s director of Information Risk Management, said: ‘Organisations wishing to gain a degree of control over their IT budgets can do a number of things immediately.’

He recommended making an IT audit, appointing a manager for IT asset management and licensing matters and appointing one or two trusted suppliers and insisting that all IT purchasing goes through them.

Links

KPMG study (.pdf format)

IT audits could save business millions

Related Articles

Is inefficiency stealing your time and money?

Accounting Firms Is inefficiency stealing your time and money?

6m Emma Smith, Managing Editor
CIMA elects new president

Institutes CIMA elects new president

6m Emma Smith, Managing Editor
Transparent currency trade: How to achieve costs visibility

Governance Transparent currency trade: How to achieve costs visibility

6m Emma Smith, Managing Editor
Introduction to KPMG UK’s new leadership team

Accounting Firms Introduction to KPMG UK’s new leadership team

6m Emma Smith, Managing Editor
EY appoints head of UK Infrastructure Asset Intelligence practice

Accounting Firms EY appoints head of UK Infrastructure Asset Intelligence practice

8m Emma Smith, Managing Editor
FRP Advisory expands operation with new office, partner appointments

Accounting Firms FRP Advisory expands operation with new office, partner appointments

10m Emma Smith, Managing Editor
Magma Group announces merger, partner promotions

Accounting Firms Magma Group announces merger, partner promotions

10m Emma Smith, Managing Editor
MHA MacIntyre Hudson advises on management buy-out

Accounting Firms MHA MacIntyre Hudson advises on management buy-out

10m Emma Smith, Managing Editor