1st Oct 2007 14:00
Micro Focus(R) (LSE.MCRO.L), a leading provider of enterpriseapplication management and modernization solutions, today unveilsevidence that global organizations generally do not know or measurethe value of their IT assets and the contribution those assets make tothe business. According to research conducted by INSEAD and MicroFocus, 30% of US CIOs and CFOs have never tried to quantify thefinancial value of their core IT assets. Despite these shortcomings,American organizations fared better than their internationalcounterparts. Over half of global CIOs and CFOs have never tried to doso. £ Results of research by Micro Focus carried out among CIOs and CFOsacross five countries (France, Germany, Italy, UK and US) highlighthow the size and value of IT assets are being ignored by the world'sleading companies, compared to other corporate assets such as cash,brand, property and intellectual property. £ Micro Focus research, conducted in companies with revenues from$100m up to over $1bn, shows that globally, only 37% of CIOs havetried to quantify the financial value of their IT assets, compared to60% of finance heads. Less than a third of all respondents (29%) fromboth groups, have tried to quantify the contribution all their ITassets make to the business' performance. £ The research found that nearly two thirds (60%) of global CFOs &CIOs do not know the size of their core software assets, whereas athird (29%) do not know what they spend on their core software assetseach year. Even more concerning is that this figure comprises almost athird (29%) of finance heads. In the U.S., nearly half are unaware ofthe size of core software assets, despite a vast majority knowing whatthey spend on core software assets. However, 58% of CIOs and CFOs inthe US believe the real financial value of core software assets isignored or poorly evaluated compared against brand, property andintellectual property values. £ Only one in two US businesses try to quantify the contribution allIT assets make to their business' performance, compared to roughly oneout of three French and German businesses and only one in fivebusinesses in Italy and the UK. £ "Given that global IT spend last year alone was over $1trillion(a), this research is a wake-up call for all of us inbusiness. This Micro Focus study shows many companies are ignoring thevalue of core business applications. The huge scale of IT spending incompanies flags a critical issue for company boards and shareholdersalike," said Stephen Kelly, Micro Focus CEO. "If organizations do notknow the cost and value of IT assets, then they must be severelychallenged to make the right IT investment decisions moving forward." £ This independent research surveyed 250 respondents across France,Germany, Italy, UK and US, comprising 50% CFOs & 50% CIOs at companieswith revenues from $100m up to over $1bn. Respondents surveyedincluded CIOs & CFOs from manufacturing, financial services, andretail sectors among others. In May Micro Focus announced that it hascommissioned INSEAD, a leading international business school, toinvestigate approaches to calculating the value of legacy IT assets.The results of this research project will be available in November. £ "This new evidence points to the fact that the size and value ofIT assets, especially software assets, are clearly under-recognizedcompared to other corporate assets in the world's largest companies,and too little resource is dedicated to evaluating their contributionto business performance," said Professor Soumitra Dutta, Chair ofBusiness & Technology at INSEAD. "This is an issue that must beaddressed if the potential of technology is to be truly realized incorporations." £ This extensive research follows a KPMG/Micro Focus study in May2007 which revealed 90% of leading companies failed to attribute valueto IT investments in their annual accounts. £ About Micro Focus £ Micro Focus provides innovative software that allows companies todramatically improve the business value of their enterpriseapplications. Micro Focus Enterprise Application Modernization andManagement software enables customers' business applications torespond rapidly to market changes and embrace modern architectureswith reduced cost and risk. For additional information please visitwww.microfocus.com. Micro Focus is a registered trademark of Micro Focus. All other products and companies mentioned in this announcement are the trademarks of their respective owners. £ (a) Source: IDC Jan 2007; IT spend $1.16 trillion in 2006 £ (b) Research carried out in partnership with research organisationVanson Bourne Copyright Business Wire 2007Related Shares:
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