‘43% of companies waste money on IT’, says report

26 July 2004 A survey by business applications vendor Sage has suggested that that more than two-fifths of companies are squandering their IT budgets.

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The Sage Business Heartbeat survey, which focuses on business performance and behaviour in the UK, found that 39% of CEOs have wasted money on IT because they cannot accurately define their business requirements.

In addition, 27% of CEOs say that integration problems, including systems being implemented poorly, have compromised productivity in their organisations.

Communication channels between IT vendors and businesses are also in need of improvement. According to the survey, more than one quarter of IT companies say that IT vendors are not in tune with their business needs and consequently sell them the wrong product – which also represents a damning indictment of companies’ own procurement processes.

A further 22% claim to have received poor customer service from suppliers.

Technology ranked as the third most important issue on which companies seek external advice on the survey – after finance and legal. However, it is unlikely that companies will turn to an IT vendor to provide advice: instead, half of CEOs choose to confer with colleagues when purchasing new software, while one-third turn to the recommendations of family and friends.

According to the survey, businesses view desktop PCs as the most important technology, with one-third of respondents claiming that they could not live without their PCs or laptops.

The survey also revealed that Londoners have the shortest working week in the UK – an average of 44.2 hours, while the Welsh work the longest week at an average of 49.75 hours. London is also the place where the fewest businesses reported a rise in turnover and profits last year.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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