Communications Rift Between the Board and IT Puts Businesses At Risk, New Research Confirms

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BMC Software, Inc., [NYSE: BMC], a leader in enterprise management, published today a research report entitled 'Lost in the Communications Chasm' that highlights a serious misalignment between the objectives of the Board and the IT team. The research (produced as a result of interviewing IT directors in companies employing over 500 people in 15 countries) goes on to identify the root cause of this misalignment and four key implications for business.

'Communications Chasm' keeps the Board and IT on separate tracks According to the research, one in two IT Directors in the UK does not believe their business and IT strategies are closely aligned. A communication rift appears to be at the heart of the problem, with the UK amongst the worst offenders. Some 70 percent of respondents identified poor channels of communication as the source of misalignment. Nearly, 40 percent of IT Directors felt they do not spend enough time with the CEO to actually understand what is required from the IT function; one in 50 respondents admitting they were kept in the dark about business objectives. Some 38 percent% feel they do not spend enough time with the CEO, with two out of three asking for as little as an hour and a half more a week to make sure they are receiving the right message.

Change - and how it is communicated - is increasing the risk of failure The research highlights that today's pace of change is creating serious implications. 30 percent of IT Directors see their business objectives change at least once every twelve months. 95 percent agree that these changes are likely to have a major effect on demands made of the IT function.

Significantly, almost two out of three believe that these changes are not actually communicated quickly enough for the IT function to respond effectively.

The research also uncovered that IT found it difficult to respond to changes in business strategy due to the communication mechanisms CEO's are using to deliver business objectives. Over one third of IT Directors receive strategic updates as formal documents making it harder for them to understand because of the missing human contact; one in 11 are told informally by word of mouth - thus confirming the level of importance given to IT and 2 percent say they are not actually communicated to at all.

Alan Smith, managing director of BMC Software UK, said: "A lot of people have suggested a misalignment between IT and the Board. This research identifies the root cause. It's time for IT to cross this Communications Chasm so that businesses can more effectively adapt to change and rely upon the business processes they need to succeed."

Attitudes to failure, and the primary role of IT, are like a ticking time bomb for business. However, the IT team needs to own its share of the responsibility for the Communications Chasm. The research uncovered some interesting attitudes to the role of IT and to failure of IT systems, which underline the importance of the IT team understanding what is really expected of them. Over a third seem to be happy to stay in the back office - and think their primary role is to just to provide operational support and administrative support. A further 51 percent see providing critical business support as their role, but only 11 percent see IT's role as providing an unique competitive advantage.

With one in four IT Directors having seen an IT failure in their critical customer service processes in the past two years, the concerning issue is that 38 percent of IT Directors said that failure of critical business processes had zero cost to the business.

The impact of this communication rift was significant for many organisations, with 38 percent of UK companies questioned reporting losses of up to 50,000 Euros and 24 percent of companies losing upwards of 50,000 Euros directly as a result of IT failures.

While under-estimating the cost of failure is an important issue, the research also demonstrates that the reactions to failure indicate that businesses do not take IT seriously or believe the competitive advantage it can deliver to an organisation. Only 36 percent of businesses assign increased importance to IT after a major business process failure. While 31 percent will increase investment in IT, a staggering 90 percent will not actively try to learn from the experience.

Lack of representation makes it harder to close the communications chasm The research identifies that nearly 36 percent of companies do not see IT and what it can deliver for the business as important enough to give it a Board position. Clearly, if almost one out of three IT teams are divorced from the seat of strategy it will make it hard for them to understand and implement that strategy.

"When you consider that modern businesses don't run without IT, it is staggering that Boards don't demand IT involvement in the development of business strategy. The fact is every business decision has an IT implication, so it is essential that IT skills are involved before those decisions are finalised or you simply build in failure and dissatisfaction," summarised Smith, BMC Software.

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