Information Technology Fails To Meet Expectations
CEOs increasingly view information technology as a key strategic tool, but are disappointed in IT achievements. Nonetheless, senior executives believe IT will deliver significant benefits in the future.
These findings highlight the Compass 1999 IT Census, an international survey of 650 CEOs and senior executives from a variety of industries. Conducted by the Department of Information Systems at the London School of Economics, the study was commissioned by Compass Analysis, a management consulting firm specializing in business performance improvement.
"The bottom line is that CEOs expect more from IT than they’re getting," said David Burkett, President of Compass America. "Whether their expectations are realistic or not is beside the point. IT management needs to do a better job at delivering and demonstrating value from IT."
Of the CEOs surveyed, 38 percent expect IT to make a significant contribution to business results, while 25 percent expect a low contribution. And 37 percent anticipate an average contribution. When asked about actual achievement, the numbers shift: 25 percent of CEOs believe IT provides a high contribution, while 33 percent say IT makes a low contribution.
When asked about future requirements, 48 percent of CEOs expect IT to make a high contribution, 22 percent anticipate a low contribution and 30 percent foresee an average contribution.
The IT executive’s role in the organization has a critical impact on CEO perceptions of IT contribution, the survey found. Among CEOs who say their chief IT executive has a prominent role in defining corporate strategy, 36 percent say IT makes a high contribution to the business, while 11 percent see a low contribution. In contrast, only 14 percent of CEOs who say their IT executive has a minor role or no role in corporate strategy believe IT makes a high contribution to business, while 20 percent of these executives believe IT’s contribution is low.
The survey also examined CEO views of IT’s impact on business performance improvement, cost reduction and competitive advantage. IT does best in improving business performance, according to the CEOs: 46 percent of CEOs expect a significant impact in this area, and 32 percent say IT has indeed
met their expectations. Just under a third of CEOs expect IT to have a high impact on cost reduction, while 24 percent rate IT achievement highly in this area. Competitive advantage fared least well in meeting expectations: 37 percent of CEOs expect IT to make a significant impact in this area, but only 19 percent are satisfied with the results. Interestingly, 54 percent of CEOs expect IT to have a significant impact on competitive advantage in the future.
Lotus Delivers R5 Notes, Domino & Designer
Lotus Development released R5 of the Lotus Notes client, Lotus Domino servers and Lotus Domino Designer. Since the first beta posting of the Release 5 products in September1998, more than 275,000 copies have been downloaded; and more than 100 Business Partners have developed applications for Notes R5 and Domino R5.
Lotus Notes R5, Lotus Domino R5 and Lotus Domino Designer R5 let users create and deploy solutions in areas such as customer relationship management, supply-chain management and knowledge management. Collectively, the Release 5 products provide the foundation for extranets to link customers and suppliers in a secure Web environment. Application developers are deploying Release 5 products for collaborative, Internet-based, customer self-service solutions. Lotus parent IBM plans to deploy more than 330,000 seats throughout its worldwide operations during 1999.
Asahi Bank Selects Mobius EDW
Asahi Bank, Ltd. of Japan has chosen the Mobius Electronic Document Warehouse (EDW) software suite to manage customer records and documents, including account records from both paper and wire transactions. The system will give users at the Asahi central bank and 330 branches instant, online access to 4,000 different kinds of documents and 100,000,000 pages of documents each year, according to bank officials.
The Mobius EDW is an integrated suite of products that archives and integrates documents of different formats on a variety of computing platforms and electronic storage devices, making them available over corporate networks and the Internet.
Asahi Bank will use ViewDirect, the archiving engine and document server, including the option to access documents direct from tape; and DocumentDirect, the Windows-based viewing client. The system was delivered by Kanematsu Electronics, Ltd. (KEL), a Mobius systems integrator in Japan.
The EDW system has been installed on desktops in Asahi’s headquarters. When fully operational, 5,000 users in all branches will use the system to archive, retrieve and display all customer management
documents. Asahi Bank expects to save 700,000,000 Yen ($6 million) –– approximately 70 percent of related administrative costs –– by providing instant access to customer documents and avoiding storage and distribution of paper documents.
In a related announcement, Mobius formed Mobius Management Systems Japan K.K., a wholly owned subsidiary based in Tokyo. The Mobius office in Japan opened on April 1, 1999; the company was registered in Japan on December 28, 1998.
A recent ruling by the Japanese government that permits electronic storage of financial data is expected to
fuel demand across multiple industry sectors for electronic archival software. Mobius Japan will market and support the Mobius EDW software in Japan and North Asia, including South Korea, China, Taiwan and Hong Kong. In addition to the Asahi Bank announcement, Japan Airlines, Mitsubishi are included as Mobius customers in Japan.
For more about Mobius, visit Mobius Management Systems at www.mobius.com