Study: UK IT managers unaware of costs

The budgeting process for IT managers in the U.K. is more like a shot in the dark than a fine science, with one in seven managers using guesswork alone to measure IT costs, according to a survey released Thursday.

The study, entitled "The Black Hole Research," found that less than 50 percent of IT managers surveyed could say with 30 percent or less accuracy, how much their companies were spending to run its IT department. Also, 50 percent of the managers said that their purchasing decisions were made without budgetary constraints in mind.

The study was jointly published by U.S.-based Peregrine Systems Inc. and the Fujitsu Ltd.-owned ICL Ltd., both e-business management companies. Two hundred U.K.-based IT managers were interviewed last May for the survey, said ICL spokeswoman Sam Baker.

It is estimated that with an annual U.K. IT expenditure of 43 billion pounds (US$59.8 billion), businesses could be losing over 6 billion pounds per year, or 15 percent of a company's IT budget, due to the simple fact that IT managers are not fully aware of just how much the technology they buy costs, ICL and Peregrine said.

When asked how many IT suppliers the company dealt with in a year, 32 percent of the IT managers couldn't guess to the nearest 10, while 18 percent had no idea at all, the study said.

Even with such numbers, only 4 percent of the IT managers surveyed considered controlling costs to be an issue for them, the study said.

The study suggested that in order to stop IT spending from being a black hole, companies should employ strict guidelines for measuring and managing IT costs on a per year basis, ICL and Peregrine said.