Tuesday, 13 June 2006

Research Exposes Business Risk Blind Spot

Failure to address IT business risk can jeopardise business outcomes, and it outlines potential blind spots for Chief Information Officers and IT leaders worldwide, said Mercury Interactive Corp. in a survey report produced in cooperation with the Economist Intelligence...

Failure to address IT business risk can jeopardise business outcomes, and it outlines potential blind spots for Chief Information Officers and IT leaders worldwide, said software testing company Mercury Interactive Corp. in a survey report. The report was produced in cooperation with the Economist Intelligence Unit.

The report details how companies around the world define IT business risk; identifies who is accountable for managing IT business risk; and confirms the approaches and strategies that global companies use to help prevent IT failures and problems from disrupting business results.

The report titled, "Managing IT Business Risk: Safeguarding the Organisation from IT Failure" is based on a global survey of more than 1,000 IT executives from 22 countries throughout the United States, Asia-Pacific (APAC), Europe, and the Middle East (EMEA).

Some key findings of the report include:
• The most feared business outcomes from IT failure are revenue loss, customer or reputation loss and cost escalations;
• The departments most vulnerable to IT failure are supply chain, production, finance and customer service;
• Difficulties in coping with change figure prominently as sources of IT failure;
• IT governance and project management are two of the most important areas in which firms will invest over the next year to improve IT performance; and
• For many companies, one in two IT initiatives do not deliver expected business outcomes.

Denis McCauley, director of global technology research at the Economist Intelligence Unit said, "Many companies do not manage IT business risk in a coordinated fashion, which should be a concern given that IT failure can lead to serious business problems, including loss of revenue and customers."

"Escalating IT change and complexity are conspiring to create a new epidemic of business risk," said Christopher Lochhead, chief marketing officer at Mercury.

Lochhead said the antidote is to first, understand the blind spots in IT that are driving the most risk into the business and then establish the right mix of process and automation to get control over change and drive predictable business outcomes.