Channel should capitalise on firms' wasted IT investment
Butler report reveals that more than 90 per cent of a typical IT budget spend brings limited value
Resellers are in a prime position to help firms gain more value from their IT investments according to a recent report by the Butler Group.
The report entitled Measuring IT Costs and Value – Maximising the Effectiveness of IT Investment, and which questioned 100 UK businesses, discovered that 92 per cent of a typical IT budget is spent on initiatives that bring only limited value and competitive advantage.
The Butler Group recommends that businesses spend a greater proportion of their IT budget on ensuring value from their IT investments, as well as on enhancements and services enabling the business to grow its overall value.
Mark Blowers, senior research analyst at the Butler Group, said resellers can benefit from businesses' apparent inability to maximise gain from IT investments.
"Businesses should invest in maintaining, upgrading and deriving the best value from their IT investments. Resellers can help them to identify what gives the business the best value from IT spend and how to use it to make their business more profitable as a result," he said.
The absence of tools and methods is a major contributor to the lack of successful measurement because ad hoc methods based on spreadsheets are no longer acceptable, according to the report.
"SMEs don't have the resources of the larger organisations, so it will be harder for them to measure and maintain value, but it's even more crucial for them. Also, since IT initiatives often don’t deliver, the channel can supply the value-add of training, procurement and rollout," added Blowers.
Nick Kalisperas, director at IT-trade body Intellect, agreed: "Resellers can benefit from services opportunities here. The IT budget should be spent wisely and effectively, but it should be customers who feel the ultimate benefit."
The international annual IT spend will be worth $1.3tn by the end of 2009, driven primarily by growth in the public sector, manufacturing and banking industries, according to a separate report by IDC.