Forrester: Business execs frequently clash with IT

A third of the 437 business executives surveyed recently by Cambridge, Massachusetts-based Forrester Research are dissatisfied with the performance of their IT departments.

          A third of the 437 business executives surveyed recently by Cambridge, Massachusetts-based Forrester Research are dissatisfied with the performance of their IT departments.

          The survey also found that the dissatisfied group was more likely to fight with IT departments for control of IT initiatives, felt that their companies lag in the adoption of emerging technologies such as content management and supply chain management systems, and face higher IT project failure rates than peers who are happy with their IT shops, says Meredith Child, a Forrester analyst and co-author of the report.

          Since this is the first time Forrester has posed these questions to business leaders, it's difficult to draw historical comparisons to executive satisfaction with IT.

          However, "if you ran this study in 1995, I bet the numbers might be flipped -- that 66% would have been dissatisfied with their IT groups," says Steve Andriole, a senior consultant at Cutter Consortium in Arlington, Massachusetts, and an MIS professor at Villanova University in Villanova, Pennsylvania.

          Since the economic downturn that began in late 2000, IT managers have had to work more closely with business leaders to cost-justify IT investments for their organisations, says Andriole. Generally speaking, IT managers "have gotten smarter about defending their IT budgets," he says. "I would be optimistic about the [Forrester] findings and expect satisfaction rates to go up beyond 66%."

          Others were a bit more skeptical about the results from the Forrester study.

          "This is a subject that goes a lot deeper than some of the simple correlations that [Forrester] built," says Cedric Rhoads, the former director of information systems at Matsushita Avionics Systems, a Bothell, Washington-based firm that provides in-flight communications and entertainment systems to the airline industry.

          Before becoming a product manager for a new aircraft ground IS group formed by the company two months ago, Rhoads helped create an IT steering committee that includes leaders from the company's five major business units, the chief financial officer and the chief technology officer. Currently, the steering committee is putting together a framework for IT project review, funding and status, says Rhoads.

          Before the launch of the IT steering committee eight months ago, the company's' IT organisation "had a history of working in the background," says Rhoads. Now, the steering committee can help the company's business units and IT department partner on critical projects, he says.

          Alignment between business units and IT is an age-old problem. As such, "why would anybody be surprised by the (Forrester) results?" asked John Parkinson, chief technologist for the Americas at Cap Gemini Ernst & Young in Chicago. "This has been a problem for the 25 years I've been in the profession."

          One of the fundamental challenges Parkinson sees is that software applications built to support business processes and operations are rigid and "antithetical to agile behaviour. Businesses like to be able to change directions on a dime, and those are conflicting forces," he says.

          While there are no easy answers to the software problem, Parkinson did offer some suggestions on how to bridge the gap between IT and business. For starters, IT departments should have some of its workers "live" with the business units to get a better understanding of what their needs are, he says. In addition, IT managers have to be straightforward with business leaders "on what's reasonable to expect from IT projects and what's unreasonable to expect."

          Parkinson cited Wal-Mart Stores, British Petroleum and a host of midsize retailers that do an effective job of aligning IT with their business units. That's largely because "companies who excel at this typically live off thin [profit] margins" and have to be razor-sharp with their IT investments, he said.

          The Forrester study, titled Why Are Business Executives So Unhappy With IT? was based on a survey business unit heads and C-level executives during the fourth quarter of 2002. It was published April 11.

          Between 30% and 40% of the respondents work at companies with between $US500 million and $US1 billion in revenues, while the rest work at firms with revenues in excess of $US1 billion.

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