I've just finished reviewing McKinsey’s third annual survey on information technology strategy and spending. According to McKinsey, the survey "affirms the continuing importance of IT for strategic success."
In this survey, McKinsey "asked chief information officers (CIOs), chief technology officers (CTOs), and other C-level executives to think broadly about the impact of information and technology on their business: how IT can serve as a tool to help build competitive advantage, what risks arise as competitors use disruptive technology, how companies develop their IT strategies, and what challenges they face in implementing those strategies." The survey reached respondents in October, so their responses include their calculations of how the acredit crisis and deteriorating economic environment would impact their business.
Four items caught my attention:
1) While businesses are making cuts to spending, they are maintaining high-priority new investments such as supply chain management that support broader business goals.
2) Expectations for ease-of-use and availability of information from enterprise application have become much higher due to the proliferation of web applications and personal devices like the iPhone that pervade everyday life. Enterprise application companies with decades of legacy code will continue to struggle to meet these user expectations.
3) The individuals most intimately familiar with the capabilities of their companies IT capabilities -- notably CIOs -- recognize that they are much less prepared to respond to risks than non-IT executives who don't deeply understand the huge technology shift that is occuring.
4) The two biggest gaps between current IT priorites and ideal IT priorities are in the areas of reducing IT costs and creating new products or services. In the case of reducting IT costs, this is a much higher current priority than the respondants believed to be ideal. Contrarywise, the effort to create new products or services is a much smaller priority than the respondants believe is ideal. This indicates that rather than putting focus on growing value to the organization through new IT-enabled products and services, companies typically gravitate towards IT cost reduction which is easier to measure and seen as a less risky proposition. Although history shows that it is the new products and services that ultimately leads to transformational value creation. Here is McKinsey's chart: