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Wednesday, September 12, 2007

Aligning Technology To Business Strategy

Bain & Company recently released some very interesting research on IT spending.

Some highlights from Bain's research on over 450 publicly traded companies:
  • 85% of respondents characterized their IT operations as ineffective
  • Bain finds that nearly one-in-two IT projects are considered partial failures upon completion, having gone over budget, past deadline and/or with under-delivered features and functionality
  • Bain found companies whose IT operations were ‘effective’ though not aligned with business priorities grew ~10% more than average and spent over 15% less on IT
  • Companies that focused on strategic alignment at the expense of effective IT operations grew almost 10% less than average and spent over 8% more on IT
BOTTOMLINE: Bain's research shows that CIOs who focus on alignment before effectiveness spend more, and their companies grow less, than those who do not focus on alignment. The conventional wisdom about aligning IT to business doesn't mean much without operational excellence.

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