While new applications offer the promise of improved business performance, such benefits are being undermined by infrastructures unable to support leading-edge technology.
That's one of the verdicts from a study commissioned by applications performance company Riverbed Technology among IT decision-makers in large EMEA organisations to better understand how effectively businesses were embracing and optimising the value of new technologies. The survey consisted of 1 012 interviews with IT decision-makers in companies with over 1 000 employees.
Riverbed says the speed of change in the technologies available to organisations over the past five years has been astonishing. It explains that social media, big data, mobility and cloud computing have disrupted existing business models and the relationship between IT, the wider organisation and its customers. In many cases, lines of business and end-users now essentially make their own IT decisions.
The company believes that business leaders see these new technologies as representing a significant opportunity to innovate, improve efficiency and provide differentiated customer experiences in highly competitive marketplaces. The challenge, however, is ensuring that repeated adoption of the "next big thing" delivers maximum benefit an optimal value to the business.
As a result of the disconnect between infrastructure and technology, Riverbed says expensive applications being deployed across the business are failing to maximise their potential, at a substantial cost to the company.
Convoluted infrastructures
Christo Briedenhann, regional director at Riverbed Technology, says as more diverse and varied applications are added to the network, IT infrastructures are becoming increasingly convoluted.
According to the study, complexity (50%) is the key reason why technology investments fail to deliver optimal value for organisations. This is followed by the need for increased skills/resources (47%) and increased security threats (44%).
In reality, says Briedenhann, these challenges have arisen from an infrastructure ill equipped to handle leading-edge applications. "As such, network or data centre performance is recognised as a significant factor in application failure (40%). However, the implications may not be 'front of mind' for many IT departments. For the majority (61%), delivering a high performance IT infrastructure for business applications is considered not core to their role," he explains.
Regionally, Briedenhann notes, network performance issues are considered more of a challenge in SA (53%), where delivering a high performance business infrastructure is also considered not core to their role (66%).
This disparity becomes even more prevalent outside of IT, where business executives are demanding new technologies but aren't tuned in to the underlying infrastructure concerns, he says.
"In fact, in only 6% of cases are board-level executives fully mindful that new technology innovations can be hampered by poor infrastructure or network performance. Thus, it's no surprise that uncertainty over ROI arises. As such, 44% think that establishing a clear relationship between IT investment in networking or infrastructure and the business benefit is not straightforward."
He believes the most critical infrastructure asset is arguably the data centre. As such, under half (42%) of businesses have reviewed their data centre as part of their network provision in the last 12 months, with a further 49% planning to do so, he adds.
The transformers
Briedenhann is also of the view that the key to success lies in having the right infrastructure in place to fully embrace, utilise and ultimately "transform" technology to the benefit of the organisation.
"Not all businesses have such processes, or even this mindset, in place. Indeed, only one in four companies (25%) can be described as 'transformers' - businesses who describe their infrastructure to support levels of technology innovation as 'excellent'.
"When looking to optimise the value of technology investments, transformers prioritise consolidation over other factors, while non-transformers prioritise efficiency. As might be expected, transformers are, therefore, more likely to have already completed (36%) or be currently implementing (41%) a data consolidation project than other companies," he explains.
To Briedenhann, with a strong infrastructure in place to support increasingly complicated and disruptive technologies, transformers are more confident in driving ROI from these investments.
The study found that 70% of transformer businesses expect ROI on most or all new technology investments within two to three years, significantly higher than 57% among non-transformers. With strong infrastructure foundations in place, new applications are more likely to be a success - 61% of new IT applications are considered a complete success compared to 52% among other companies, says Briedenhann.
He adds that transformers are experiencing greater business value as a result of technology investment across a range of different areas - most notably, improved supply chain (51% compared to 21% among non-transformers), better collaboration (46% compared to 29%), greater agility (46% compared to 22%) and improved decision-making (45% compared to 26%).
According to the research, 24% of South African companies are transformers.
"South African companies spend, on average, 26% of their IT budgets on deploying new technologies. Areas where South African companies introduced new technologies/services in the past two years are cloud (52%), social media (50%) and mobile app development (58%)," Briedenhann concludes.
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