Spending to save on IT infrastructure

Manufacturing companies’ IT spending is primarily to improve system stability and up-time (39%) and to deliver business benefit, according to 39% and 38% of IT directors respectively. Only 20% are spending to cut costs. That’s among findings of research commissioned by IT services provider Synstar. Asked about the most effective way to save money, it finds over half (55%) suggesting selective outsourcing, 28% reduced software spend, and 11% reduced hardware investment. None view wholesale outsourcing as sensible. 16% of manufacturing IT directors also point to systems integration as their least effective deployment of IT effort over the past 12 months. Interestingly, enterprise software was cited by 21%. Budgets remain tight, with 70% saying they have a budget freeze), and just under half (48%) view wider cost-cutting initiatives across the business as the greatest threat to their role. The biggest threat, however, according to 34%, comes from a lack of proven benefit from existing IT strategy. Only 7% say they always see return on an IT investment, and 10% don’t know whether any of their investments have yielded a return. Russell Flower, director of managed services at Synstar, comments: “Over the past 12 months, IT directors in manufacturing have realised that investing simply to cut costs is a short-sighted approach… But 55% of them seem to agree that outsourcing selected IT functions to a managed services provider could help them achieve more with less.”