Over-complex IT creates cost headache for bosses

Drive to simplify vendors and systems on the way...

UK companies are locked into a "vicious cycle" of spiralling costs and inefficiency as a result of over-complex IT systems.

Three-quarters of the 455 silicon.com readers surveyed by the Bathwick Group said their company had ended up with equipment from multiple vendors as a result of various projects.

Two-thirds (69 per cent) said that most of their core applications ran on their own servers - the result of buying new systems for each big project rather than working towards a standard infrastructure.

The research, sponsored by BT, claimed the result of this complexity is higher IT costs and barriers to change.

As much as 70 to 80 per cent of many companies' IT budgets go on maintenance of existing systems, the report said. And while 30 per cent of respondents said their IT budgets would increase by more than 10 per cent this year, 25 per cent expect rises of more than 10 per cent in legacy maintenance costs.

As a result, three out of five senior managers are planning to reduce the number of vendors, hardware types and operating systems they support.

And 57 per cent of companies surveyed said they have IT simplification projects running - a figure which rises to 90 per cent for organisations of more than 10,000 staff.

But these plans are being hindered by company procurement processes as nearly three-quarters (72 per cent) continue to buy technology on a project or 'fit for purpose' basis.

Last week similar research found companies that attempt to cut IT budgets by holding onto ageing legacy systems become caught in an "austerity trap" which leads to higher costs in the long term.

Gary Bullard, managing director of BT UK major customers, said companies in the UK are suffering from "diverged IT infrastructure".

He said: "Despite many years of recognising that complexity is the enemy of productivity and cost reduction, there is a clear lack of joined-up thinking on the part of these senior decision makers on how to address the problem and break this vicious cycle."