1st Oct 2007 09:00
Micro Focus International plc01 October 2007 Media Contacts: Tim Brill Dan Chappell / Sam KaneMicro Focus Brands2Life+44 1635 565364 +44 20 7592 [email protected] [email protected] MICRO FOCUS STUDY REVEALS I.T. SYSTEMS ARE THE LOST CORPORATE ASSET • Less than half of CIOs and CFOs ever try to quantify the financial value of their IT Assets • Nearly two thirds (60%) do not know the size of their core software assets • One third do not know what they spend on their software assets • More than half (56%) think the real financial value of core software assets is ignored or poorly evaluated compared against brand, property and intellectual property values Forthcoming INSEAD study to act on evidence to assess business value of hidden technology investments NEWBURY, England, 1st October, 2007 - Micro Focus(R) (LSE.MCRO.L), a leadingprovider of enterprise application management and modernization solutions, todayexposes that global organisations generally do not know nor measure the value oftheir IT assets and the contribution those assets make to the business. Results of research by Micro Focus carried out amongst CIOs and CFOs across fivecountries (France, Germany, Italy, UK and US) highlight how the size and valueof IT assets are being ignored by the world's leading companies, compared toother regularly measured corporate assets such as cash, brand, property andintellectual property. Micro Focus research, carried out in companies with revenues from $100m up toover $1bn, shows that less than half of all CIOs & CFOs (48%) ever try toquantify the financial value of their IT assets. Only 37% of CIOs have tried,compared to 60% of Finance Heads. Less than a third of all respondents (29%)from both groups, ever try to quantify the contribution all their IT assets maketo the business' performance. The research found that nearly two thirds (60%) of CFOs & CIOs do not know thesize of their core software assets, whereas a third (29%) do not know what theyspend on their core software assets each year. Even more concerning is thatthis figure comprises a third (29%) of Finance Heads. German respondents have more knowledge of their software assets than any otherregion. 60% of CIOs and CFOs in Germany say they know the size of their coresoftware assets compared with 52% of US respondents, 40% of Italians, 36% ofFrench and only 12% in the UK sample. The UK is on the same level as Italy, where only one in five businesses try toquantify the contribution all IT assets make to their business' performance,compared to one in two US businesses and roughly one out of three French andGerman businesses. Over half of all respondents (56%) think that the real financial value of theircore software assets is either totally ignored or poorly evaluated compared withother assets including brands, property, and intellectual property. "Given that global IT spend last year alone was over $1 trillion (1), thisresearch is a wake-up call for all of us in business. This Micro Focus studyshows many companies are ignoring value of core business applications. The hugescale of IT spending in companies flags a critical issue for Company Boards andShareholders alike" said Stephen Kelly, Micro Focus CEO. "If organisations donot know the cost and value of IT assets, then they must be severely challengedto make the right IT investment decisions moving forward." This independent research (2) surveyed 250 respondents across France, Germany,Italy, UK and US, comprising 50% CFOs & 50% CIOs at companies with revenues from$100m up to over $1bn. Respondents surveyed included CIOs & CFOs frommanufacturing, financial services, and retail sectors amongst others. In MayMicro Focus announced that it has commissioned INSEAD, a leading internationalbusiness school, to investigate approaches to calculating the value of legacy ITassets. The results of this research project will be available in November. (1) Source: IDC Jan 2007; IT spend $1.16 trillion in 2006 (2) Research carried out in partnership with research organisation Vanson Bourne "This new evidence points to the fact that the size and value of IT assets,especially software assets, is clearly under-recognised compared to othercorporate assets in the world's largest companies, and too little resource isdedicated to evaluating their contribution to business performance," saidProfessor Soumitra Dutta, Chair of Business & Technology at INSEAD. "This is anissue that must be addressed if the potential of technology is to be trulyrealised in corporations." This extensive research follows a KPMG/Micro Focus study in May 2007 whichrevealed 90% of leading companies failed to attribute value to IT investments intheir annual accounts. About Micro Focus Micro Focus provides innovative software that allows companies to dramaticallyimprove the business value of their enterprise applications. Micro FocusEnterprise Application Modernization and Management software enables customers'business applications to respond rapidly to market changes and embrace modernarchitectures with reduced cost and risk. For additional information pleasevisit www.microfocus.com. ### Micro Focus is a registered trademark of Micro Focus. All other products andcompanies mentioned in this announcement are the trademarks of their respectiveowners. NOTES TO EDITORS: KEY DATA • Less than half (48%) of respondents ever try to quantify the financial value of their IT assets - Only 37% of IT Heads have tried compared to 60% of Finance Heads • Less than third (29%) ever try to quantify contribution all their IT assets make to their business' performance - Finance Heads are nervous with only 10% of those who try confident of their quantification • Nearly two thirds (60%) don't know the size of their core software assets • A third (29%) don't know what they spend on their core software assets on an annual basis - A third of Finance Heads don't know how much they spend! • 56% think the real financial value of their organisation's core software assets are either totally ignored or poorly evaluated compared with other assets such as brands, property and intellectual property - 60% of Finance Heads think this compared to 47% of IT Heads "Do you know the size of your core software assets?" Sample Size • 250 respondents across France, Germany, Italy, UK and US - 50% Finance Heads and 50% IT Heads (not from the same company) • All companies had revenues of $100m - 51% turnover $1bn+ • Sector breakdown - 25% Manufacturing - 19% Financial services - 11% Retail - 11% Distribution & wholesale - 11% Utilities & telecoms - 23% Other This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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