Survey: business views IT more positively in wake of economic slump

New McKinsey & Company survey finds IT may its own toughest critic
Written by Joe McKendrick, Contributing Writer

Usually, when push came to shove as budgets tightened, executives were quick to put the axe to information technology departments and projects -- perceived as cost centers and the biggest targets in the organization. This time around, though, things were different.

New McKinsey & Company survey finds IT may its own toughest critic

New research out of McKinsey & Company shows ithat n the wake of the recent economic hurricane, many non-IT executives seemed to have developed a healthier appreciation for their information technology functions. Business executives, overall, seem pleased with the way IT helped organizations navigate the rough seas. IT leaders, however, feel they could be doing better.

This gap between IT and business perceptions was released in a recent McKinsey & Co. study of 444 higher-level executives from a range of industries and geographies. The authors, Roger Roberts and Johnson Sikes, report that the recent economic downturn only increased awareness of the role IT can play in improving business processes and reducing costs.

McKinsey found that non-IT executives by and large believe their IT functions responded effectively to the crisis. A majority, 55%, say current performance in providing basic IT services is very or extremely effective—an increase from last year’s 50% level.

It turns out IT may be it's own toughest critic. However, less than half of the IT executives surveyed say their management of IT infrastructure is extremely or very effective. Only 30% say their IT governance is extremely or very effective, and only 21% are happy with the ability of IT to add value to their business, compared to 30% of non-IT executives.

(Panel discussion finds consensus that governance is vital as businesses go into expansion mode. Details in my previous post.)

A majority of non-IT executives also are mainly pleased with IT's ability to deliver projects on time and on budget (more than 30% say IT is very effective, and 33% say IT is somewhat effective).

The survey also suggests that organizations that took the most advantage of information technology going into the recent downturn may have come out the strongest.

In terms of IT spending in the coming year, while 60% intend to hold the line on IT operating expenses, but close to half, 45%, expect to see new investments in IT.

There's been no shortage of discussion of the "IT-business alignment gap," and particularly the perception that IT seems out of touch of the business. In this side-by-side research, McKinsey & Company indicates that IT executives are well aware of the shortcomings of their systems in terms of keeping up with the business. For now, though, it appears IT has emerged as the heroes that helped pull companies through the economic tsunami. But IT executives have no time or inclination to bask in the glow.

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