Report reveals IT quandary

A new KPMG Consulting report, E-business and beyond, highlights the growing recognition of the importance of IT, and its role in ebusiness, in the boardrooms of the UK’s largest companies, but warns that many companies don’t know what to do about it.

Over three-quarters of those consulted claimed IT is already significantly changing the way their organisations operate and is becoming a key part of business strategy. However, they lack confidence in their organisation’s ability to exploit IT and their personal ability to sponsor innovative projects, and don’t know where to seek guidance to overcome these barriers.

KPMG warns that the accelerating pace of ebusiness demands that companies take positive action to innovate in IT, because bystanders will be condemned to a following role or even extinction.

Alan Buckle, CEO at KPMG Consulting, said that directors are beginning to consider the impact of technology on corporate strategy, but its rapid development means that they are frequently bombarded by complex and often contradictory messages. This, he says, complicates decisions about the practical application of IT.

A number of results from the report show how IT innovation and an organisation’s IT function are prioritised: in 65 per cent of board meetings IT is discussed regularly; 70 per cent of IT budgets were reported to have increased since 1998; and 51 per cent of those consulted believe they will increase further in 2000.

Other findings reveal problems directors are encountering. When asked what barriers prevent the adoption of new technologies; 28 per cent of respondents claimed that IT was not sufficiently proven; 27 per cent felt that they lacked senior sponsorship within their organisation; and 21 per cent felt that their workforce lacked the skills to implement and work with new technologies.

One third of board level directors admitted they did not know how to overcome these barriers, and despite believing that customer expectations are their key challenge, business leaders still give investment priority to improving efficiency and reducing cost.

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