In October 2001 a report from McKinsey finally said what all those responsible for recommending IT expenditure had been dreading: there is no evidence to show that all the money spent has been worth it.

Over the last few years suppliers have enjoyed a boom time promoting messages about how IT will add to your business' competitive edge and improve your productivity. McKinsey's report shows that although IT expenditure increased by 20% year-on-year from 1995-2000, in 53 of the 59 sectors of the US economy there was just 0.3% growth in productivity.

This means that IT will get a harder time in the Board Room than it has for some while. Managers going in to request IT expenditure are going to need better and better cost justifications. Those who agree the budgets are going to want reassurance that resources bought have already been fully exploited. Before they agree further spending, management will need to be convinced that there is no alternative. Money is only likely to go to the projects that offer a quick return on investment, not a vague promised improvement in productivity.

This means that anyone trying to justify expenditure is going to need to be proactive. The contrast between reactive and proactive management is no more apparent than in the field of Performance Management of IT systems. It might not be enough in the future to drive your car by looking only in the rear view mirror and reacting to what has already happened. Before you get the next hardware upgrade approved, you might well need to show that you have also looked out of the front window.

Being proactive in performance terms means getting away from alerting and starting to look at performance on a regular basis. This enables you to spot trends towards bad performance before crises occurs and ensure that systems are reorganized to remain efficient and productive.

A further step forward takes you into performance planning, possibly an essential step in hardware purchase in the future. Management will want to see that all possible economies have already been made in terms of server consolidation before more expenditure is approved. New purchases will need to be justified in terms of the payback they offer to the business and shown to be the best possible option, not just the biggest machine we can afford or the one the supplier is keen to sell.

The problem is that unless you have the right software, good reporting and planning data takes time and effort to generate. Automation of repetitive tasks and a performance product that doesn't have a heavy personnel overhead to run it could become ever more important purchasing prerequisites.