Research by CSC and FEI Shows 60 Percent of Respondents Lack Strategic IT Plan
EL SEGUNDO, Calif., Jan. 28 /PRNewswire/ -- Businesses that align their
information technology (IT) strategies with their business strategies are
significantly more likely to achieve a high return on IT investment, according
to a survey of senior financial officers conducted by Computer Sciences
Corporation (NYSE: CSC) and Financial Executives International (FEI).
However, 60 percent of survey respondents reported that their corporation has
no strategic IT plan.
The survey report, the sixth annual Technology Issues for Financial
Executives, identifies the IT trends most critical for chief financial
officers (CFOs) and other senior finance executives. In addition to the
disconnect between technology and the business plan, this year's highlights
include increased focus on information security and a snapshot of progress
regarding enterprise resource planning (ERP) projects.
The survey found that 10 percent of companies achieve a high rate of
return on investment for IT projects. Among those companies with a business-
aligned IT plan, however, that percentage more than doubles to 24 percent.
Unfortunately, few organizations have such close alignment. The survey
shows that only seven percent of respondents have an IT plan fully aligned
with their corporate strategy. Roughly 30 percent of respondents reported at
least some form of alignment between business and IT strategies, but the
majority lacked any such plan.
"Now more than ever, there is a pressing need for executives to link IT
spending to business strategy as opposed to previous history or industry
averages," said Ed Mello, chief operating officer of CSC's Consulting Group.
"Companies that are successful in connecting strategy with spend are best
positioned to make smart business decisions -- whether they involve creating
new business models, addressing escalating risk and security issues, or
optimizing their extended enterprise."
Security emerged in the report as a key concern for financial executives.
More than half of respondents said that identifying the appropriate level of
security for information and electronic applications was very critical to
their organization.
When asked to rate their level of concern regarding various facets of
information security, nearly all respondents said that growing dependence on -
- and risk of -- computerized and automated systems was a critical or
important concern. Roughly two thirds were highly concerned about industry
standards and cost of compliance with new legislation such as Sarbanes-Oxley
and the Health Insurance Portability and Accountability Act (HIPAA). Half
were highly concerned about growing IT security expenditures. Just a third of
respondents found terrorism against their companies a critical or important
concern.
The respondents also described their experiences regarding their
enterprise ERP implementations. ERP projects took longer than expected for
more than 40 percent of respondents and cost more than expected for 55 percent
of respondents. While ERP implementations are difficult, they also appear to
be worth it for many respondents: three out of four of those who completed an
ERP implementation rated it a success.
"Only by linking IT and business strategy can companies really assess the
ultimate ROI of information technology investments," said Rebecca Segal, vice
president, Worldwide Services and Solutions Integration Strategies Research.
"This survey is a wake-up call for financial executives to take action given
the potential benefits to be gained."
The report surveyed 607 respondents, 84 percent of whom are the
senior-most financial executive in their organization. Almost all respondents
are from the United States and Canada.
"Because the survey encompasses senior financial executives from all major
industries and organization sizes, it serves as an important IT benchmark for
all CFOs," said Mello. "The CFO's perspective on technology is critical in
that he or she often oversees the technology organization in addition to their
primary responsibility of ensuring that all expenditures are in the best
interest of shareholders."
This year is the first CSC is offering its point of view on key topics
associated with the survey results. Commentary regarding IT spending,
security and ERP is available, along with a downloadable copy of the report,
at http://www.csc.com/solutions/managementconsulting/news/2465.shtml . To
view a current csc.com feature story on the report, visit
http://www.csc.com/features/2004/4.shtml .
About FEI
Financial Executives International (FEI) is the leading advocate for the
views of corporate financial management. Its 15,000 members hold policy-
making positions as chief financial officers, treasurers, and controllers.
FEI enhances member professional development through peer networking, career
planning services, conferences, publications, and special reports and
research. Members participate in the activities of 86 chapters, 75 of which
are in the United States and 11 in Canada. For more information about FEI,
visit http://www.fei.org .
About CSC
Founded in 1959, Computer Sciences Corporation is a leading global IT
services company. CSC's mission is to provide customers in industry and
government with solutions crafted to meet their specific challenges and enable
them to profit from the advanced use of technology.
With more than 92,000 employees, CSC provides innovative solutions for
customers around the world by applying leading technologies and CSC's own
advanced capabilities. These include systems design and integration; IT and
business process outsourcing; applications software development; Web and
application hosting; and management consulting. Headquartered in El Segundo,
Calif., CSC reported revenue of $13 billion for the 12 months ended Oct. 3,
2003. For more information, visit the company's Web site at http://www.csc.com .
SOURCE Computer Sciences Corporation
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Related links:
http://www.csc.com
CONTACT:
Janet Herin, Media Relations, Corporate, of
Computer Sciences Corporation, +1-310-615-1693, jherin@csc.com
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