World-class IT departments spend 20% less on tech

Research shows the very best IT departments get by with fewer staff

World-class IT organisations are spending 21% less per end user than companies that don't perform so well, research by the Hackett Group has revealed.

Additionally, those with the most effective IT strategies have 8% fewer staff and make savings of as much as $41 million (33 million) because they allocate much less of their budget to processes compared to companies with less effective strategies.

The Hackett Group, a best practice consultancy, explained that the very best IT organisations spend 53% of their budget to maintain and run their infrastructure, compared to less effective organisations, who spend 60% of their budget on this.

That leaves a larger chunk of budget to allocate to innovation, with world-class IT departments spending 43% of their budgets to build better systems, compared to 32% of less effective companies' budgets.

Advertisement - Article continues below
Advertisement - Article continues below

"IT organisations are under immense pressure to deliver new, often client-facing systems of strategic importance to the enterprise," the report said. "To respond to these demands, they must divert resources from basic 'run-the-business' activities."

Legacy maintenance and support should be kept in-house rather than being outsourced, the research suggested. World-class companies spent 2% less on outsourcing and although nominal in proportion to the total amount of budgets, Hackett Group said that saving budget on outsourcing can represent significant savings in the long run.

"Although achieving world-class performance is a long journey, IT organisations can see marked improvements fast," the Hackett Group said. "Early wins can free up resources enabling IT to better support digital transformation, including improvement of analytics capabilities, supporting development of client-facing systems and mobile initiatives."

The company identified four key focuses for organisations to improve IT performance, including reallocating resources from transactional to value-adds, embracing digital transformation, leading the organisation via analytics and adopting a customer-centric approach in both design and delivery.

Featured Resources

How inkjet can transform your business

Get more out of your business by investing in the right printing technology

Download now

Journey to a modern workplace with Office 365: which tools and when?

A guide to how Office 365 builds a modern workplace

Download now

Modernise and transform your sales organisation

Learn how a modernised sales process can drive your business

Download now

Your guide to managing cloud transformation risk

Realise the benefits. Mitigate the risks

Download now

Most Popular

cloud computing

Google Cloud snaps up multi-cloud analytics platform for $2.6bn

13 Feb 2020

How to use Chromecast without Wi-Fi

5 Feb 2020
operating systems

How to fix a stuck Windows 10 update

12 Feb 2020
Microsoft Azure

Microsoft Azure is a testament to Satya Nadella’s strategic nouse

14 Feb 2020