Most companies 'guess' IT return on investment

Most organisations rely on guesswork and personal intuition when calculating the return on investment of IT expenditure, according to a new study.

The e-Skills UK quarterly ICT Inquiry research found just 11 per cent of businesses measure ROI for IT spending. Those that do are predominantly medium-sized and large organisations and are themselves in the IT sector.

The other 89 per cent were able to provide an insight into the likely impact on productivity for certain types of IT expenditure but the survey found this was primarily through the application of "informed guesswork" or "personal intuition" and not any defined process of measurement.

Staffing remains an issue for many organisations, with two-thirds saying the level of IT user skills among the entire workforce has a large impact on productivity. But the "single most defining impact on productivity" comes from the availability of PCs, according to half of the survey's 1,000 respondents.

Offshoring is surprisingly low down the list of IT priorities with 97 per cent saying they do not offshore any IT or telecoms activities and 98 per cent of those saying they would not consider doing so over the next two years.

But outsourcing is moving up the IT agenda with 16 per cent of companies - compared to five per cent in the previous quarter - saying they anticipated an increase in IT outsourcing spending.

Key priorities for IT departments in the study were technical issues (23 per cent), followed by business issues (10 per cent).