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2008: IT budgets to fall?

Euro If the pundits are right, IT budgets will be smaller next year. Or, to put it more correctly, the percent increase for 2008 over 2007 will be less than the percent increase for 2007 over 2006. Are you still with me?

As an example, take the recent article by John Soat of Information Week, who cites two separate surveys involving CIOs. Both predict smaller budget increases for 2008. Mind you, this is across all industries and it's not clear what will happen in the Biopharma sector.

We can guess, however, that based on the somewhat dismal performance of most pharma and some biotech companies, CEOs will be looking for savings wherever they can be found. And that includes IT.

From my perspective, this is quite unfortunate since I am convinced that our industry has squandered countless opportunities to leverage information technologies to improve both day-to-day operations and improve the R&D pipeline. If you want examples, I'll give you several:

  • document management and electronic publishing
  • data management and exploration
  • electronic data collection (EDC)
  • clinical trial management
  • master data management

Now, you may be saying: "Is this guy nuts? These are the areas where we have made the most progress!"

And no, I'm not nuts. These are great examples where lots of time and money have been wasted or investments underperformed. Despite glowing reports at DIA meetings and other venues, the reality is that we still don't know how to properly leverage IT.

I'll offer just a few reasons why our IT dollars/euros don't get us the returns we need:

  1. Lack of resolve and leadership to change course;
  2. Continued disconnect between the business community and the IT organization;
  3. Missing or half-baked strategy for improving productivity;
  4. Cowardly management disguised as management by consensus;
  5. Focus on regulatory compliance rather than operating efficiency;
  6. Failure to create a learning and innovative organization;
  7. Over-reliance on selecting technology rather than setting strategy that drives technology.

So, it's possible that we don't actually need to increase the IT budget. Maybe it would be enough to just stop wasting it.

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