Short-termism – Unfair to IT?
It’s a fact: various studies show that the main benefits from IT are long term. This should not surprise anyone. Most organisations have systems that might be ten or twenty years old and consistently perform a crucial function year in and year out. There is much evidence to show (read Strassmann) that many systems deliver more value as they get older. Glitches have been eliminated, integration is more extensive, training has been done, the initial justification period has expired, and so on.
In today’s economic climate it seems very few managers are thinking about the long term returns from IT investments. If a return cannot be shown over a six to twelve month period a project never sees the light of day – and it’s quite understandable. Nonetheless if we are to be evaluate a potential IT investment sensibly we need to consider a timeframe extending beyond the initial justification period, and some estimate of long term returns made. It is often the case that projects that are justified on a short-term return basis simply fix some transient need. With IT we always overestimate short-term effects and underestimate long-term payback. This is unfair, and contributes to the negative press that IT often gets.
Unlike most investments – plant, machinery, office equipment and so on, IT systems do not wear out or depreciate. The usual accounting methods do not apply, although they will no doubt persist. The investment machinery in most organisations is fairly prescriptive, but it is certainly worthwhile considering the longer term impact of an IT investment – just to be fair.
