Headlines: August 12th, 2010

At a time when technology is a key factor in efficiency plans, a report by the Society of IT Management reveals that the local government spend on ICT has been in decline since 2006. The Society’s Benchmarking services summary for 2009 presents a picture of ICT managers reducing costs and driving up user satisfaction, against a background of declining expenditure.

The report says that the reductions in cost are worrying. ICT spend per user has dropped by 15.75 per cent in real terms since 2008 and by 19.3 per cent since 2006. The report authors argue that organisations should be maintaining or even increasing ICT spend at the current time in order to achieve larger savings through ICT facilitated developments like pervasive flexible working, shared services, application of lean thinking, and e-procurement.

The reductions in spending suggest that top management teams do not take this view, or doubt the ability of ICT to deliver. The report says this could be explained by weaknesses of ICT governance, and in particular, the reluctance of ICT leaders to focus on benefits realisation.

The report also expresses concern about ICT managers protecting their transformational capacity to support other services in making savings. It recognizes that political pressures dictate that ICT must take its share of the current budget cuts. But ICT managers are urged to focus savings on its ‘business as usual’ capability, and to maintain or strengthen its capability to tackle transformational projects.