Technology services group's head of strategy says that rather than focusing on short-term costs, companies need to invest in long-termsolutions and to ensure that their systems perform efficiently, writes John Collins

Following the PPARS fiasco, technology consultants may not have the best reputation, but then most corporate consultants don't tend to be as straight talking as Bob Suh.

Recently voted one of the top 25 consultants of 2005 by the readers of Consulting magazine, Suh is chief technology strategist with Accenture. He was also one of the main people behind a recent Accenture survey of more than 300 chief information officers (CIOs) at global corporations that sought to find out where money is effectively being invested in IT.

One of the most startling statistics revealed by that research was that, while heart transplants are now successful in 95 per cent of cases, only 29 per cent of IT projects are successful. In fact, on average, IT projects overrun their initial budgets by 56 per cent and take 84 per cent longer than initially planned.

"Heart transplants came out around the same year as the first IBM mainframe," explains Suh. "Most patients died within the first two weeks so, with the high failure rate, the only patients that underwent heart surgery were those whose only option was near-term death.

"As the failure rate went down and the success rate went up for heart surgery, people started to do it more pre-emptively. Bill Clinton, for example, the day before he went back in for another quadruple bypass went golfing, because there is a 98 per cent success rate for the procedure. But there aren't that many CIOs who go golfing the day before they launch a $100 million (€85 million) project."

Suh and his colleagues at Accenture believe that the uncertainty surrounding the execution of IT projects is holding back investment in new technology.

Accenture's research has found that the most successful IT organisations, defined as those in the highest performing firms, are those that invest most in new technology. In contrast, poorly performing companies spend an inordinate amount of time working on older legacy systems.

Consequently, Accenture says these firms are caught in an austerity trap - they underinvest to reduce short-term costs, but as a result spend a larger percentage of their time and money maintaining and fixing their systems.

"It's definitely a pay me now or pay me later problem that companies have," says Suh. "The only thing people seem to focus on is the purchase price.They are not looking at the total performance end to end of what IT is. That's really the iceberg beneath the water part of IT that companies really need to start focusing on."

It may come as no surprise that such a senior strategist at one of the world's largest technology services companies - Accenture had revenues of $15.55 billion (€13.2 billion) in its last financial year - is advising companies to invest in new technologies.

But Suh is also happy to discuss how the IT industry itself needs to change to deliver projects on cost and on time. For a start, he believes there is too much focus on measuring cost and not enough on measuring performance. "CIOs know how many people they have, how many servers they have, how much software they buy and they know that they are getting the best deal at that level for all of those items," says Suh. "What they don't know is how all those people spend their time. How much of that time is wasted? What is deceptive is that they are not massively increasing the number of servers, the software licences or the number of people."

The task of recording where the time is spent is not a technology issue - there are many software programs on the market that will enable companies to do that. What is required he believes is a change in mindset and a discipline that is more normal in other industry sectors. Largely, this doesn't happen because technology is a relatively new discipline - just 30 years old - and processes are not as universally applied as they are in other professional disciplines.

Rather than just seeing IT investment as a one-off event, Suh suggests that technologists could learn a thing or two from the stock market tactic of dollar cost averaging. This strategy involves steadily investing in what you consider to be a good stock, regardless of the market price. In contrast to trying to buy low and sell high, investors believe this strategy delivers a better return in the long run.

"Similarly, with IT investing, if you constantly invest and you constantly retire older applications at a steady pace and set quotas for yourself, you'll end up having a higher performing IT operation and having more money to re-invest without having to spend more overall," explains Suh. "That's really the key, it's the reverse of the austerity trap."

Although he won't comment directly on the issues surrounding the massive cost overruns on the Health Service Executive's PPARS project, Suh suggests that such out of control projects are often the result of the "double cup" syndrome. To prevent his hands being burned by hot coffee in a paper cup, Suh used to order his Starbucks in two cups, ie one inside the other. But one day, a new employee poured a full cup of coffee into two cups and handed them to him.

"It was not what I wanted, but she did exactly what I asked," says Suh. "There are a lot of 'double cup' outcomes where IT teams build exactly what is asked for, but what is asked for may not be specific enough to meet the needs of the business. The other issue is that there is still a very bad habit of 'I don't know what I want, but I know what I don't want when I see it'. That costs a lot of money in IT.

"People sometimes can't articulate exactly what they need from IT, but when they see what they don't need, they tell you. That's a very expensive way of building systems. You wouldn't build a building and say when you put the door up: 'do you want it there or do you want it five inches to the right?'. You have to decide where the door is going to go the first time."

Suh was in Ireland last week for a dinner with chief investment officers from some of Ireland's top companies that was hosted by Accenture. So are the issues facing Irish technology managers very different from those that his international clients are dealing with?

"Despite what our clients will say about ensuring we understand their local issues and concerns, what surprised us is how global IT execution issues are," says Suh. "The issue that chief investment officers grapple with - focusing on creating value with technology - is universal."