Shows CIOs Are Sitting on a Gold Mine

VentanaSearch: Quantified Research Shows Best Practices in IT Spend Effectiveness Results in Faster Growing Budgets and Greater Control. Confirms rigorous management of IT operations leads to more effective IT spending and revealed that companies that take this approach also have had the fastest growth in IT budgets over the past three years. Moreover, CIOs in companies with more effective spending practices also had greater influence in setting IT budgets than those that did not. Almost all large companies have implemented more stringent IT governance practices over the past five years, but their focus has been on hardware and software purchases, not operations. Ventana Research found that consistent use of disciplines such as IT portfolio management, asset management and having spending visibility are critical to getting the most bang for the buck. Too often, companies focus almost exclusively on their IT capital budget and do not pay enough attention to management practices that we believe would enable many of them to save at least 5 percent of what they are spending on day-to-day activities, support and maintenance contracts and so on,observed Robert Kugel, who directs Ventana Research’s Financial Performance Management practice. CIOs that employ these sorts of best practices are rewarded with faster growing budgets and greater control of them.” Companies that manage IT operations effectively have detailed visibility into their spending and use objective data consistently report more effective use of their IT budgets:

• Companies with real-time visibility into projects and performance metrics rated their IT spending effectiveness 64% higher than those that did not.

• Companies with a formal application review process rated their spending effectiveness 22% than those that do this on an ad hoc basis.

Unlocking the Value of IT Publ 20060911