CIOs: Crisis of Confidence

By Edward Cone  |  Posted 05-05-2005 Print Email
IT and businesspeople trust the technology they're building, but not their company's ability to use it correctly, Bain report reveals.

It sounds a little dry, the Bain & Co. "Management Tools and Trends 2005" survey, but behind the numbers lurks enough drama for a full season of Desperate Housewives. Self-doubt, broken trust, fads and popularity contests—the report has them all, says David Shpilberg, leader of Bain's Global Information Technology practice.

The 2005 edition, Bain's tenth such survey in the past 12 years, tracks the management practices and technologies deemed most important by almost 1,000 business and IT executives at companies around the world.

The bottom line: Managers believe strongly in the value of information technology, but often lack confidence in the ability of their own companies to use it well.

"What is startling to us is that almost 90 percent of executives believe IT can provide a strategic advantage, but so many of them see significant misalignment of IT and business strategy at their own companies," says Shpilberg.

Only 60 percent of respondents said IT spending is "completely aligned to our business strategy." Another Bain survey, says Shpilberg, shows that 70 percent of executives believe IT is crucial for growth, but at least a third of those believe that in their own company IT is a deterrent to growth. "And those are the believers," says Shpilberg.

Another disconnect: While executives continue to rate supply-chain management among the most useful areas of focus, only 42 percent say their company has "the capability to effectively manage a global supply chain," with 30 percent actively disagreeing that they could do so.

Why the gloom? Shpilberg says at many companies the failure of a single large project can initiate a "tailspin caused by loss of trust between business and IT organizations."

Bad news, he says, can become "a seminal event" that stifles further innovation and forces IT to focus only on efficiency and cost reduction. Yet 86 percent of respondents say innovation is more important than cost reduction for long-term success.

The best news from the survey for CIOs, says Shpilberg, is the near-universal belief in the power of information technology to make companies into more formidable competitors.

"It's an invitation for business to say, 'Team up with me, I acknowledge that you are not just about productivity and cost. You are about new ways to revenue, new ways of getting to our customers.'"



 

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