There is a huge variation in the prices US organisations are paying for similar products and services, while some high spenders are wasting money because they assume expensive means good.
A survey of chief information officers from 500 corporations, conducted by Deloitte & Touche Consulting Group, found that one company investing $10 on a particular technology got the same cost savings from it as another company that spent $1.
Although there are no similar figures for Europe, one consultant at Deloitte said he suspected very similar patterns existed there "though perhaps less extreme".
The report defines two camps of companies - 'high spend' and 'low spend' firms. ?Chief information officers of low spend companies tend to focus on their company as if it were a customer and align IT to meet the company?s business objectives,? said Rich Pople, senior manager at Deloitte & Touche Consulting. ?High spend companies tend to get swallowed up by technical issues such as redundant technology, customisation efforts and a portfolio of whizzbang technology looking for problems to fix,? he said.
The research found that low spend companies use 24 per cent fewer telecomms technologies and 22 per cent fewer software technologies than high spend companies. ?Low spend companies also avoid the temptation of investing in ?faddish? new technologies, spending an average of 55 per cent less on new technologies than their high spend counterpart,? reports the survey.
Companies that spend the least also boast lower staff turnover - 8.4 per cent compared to 16 per cent for complex IT environments. They also spend twice as much on training.
Low spend companies first look at business objectives and then determine how technology can help. High spend companies rank Internet and Intranet integration as its third most important objective, after recruitment, training and year 2000 projects.
?This indicates that high spend companies seem to deploy technologies before assessing the larger business needs, resulting in more complex and inefficient environments,? concludes the report.
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