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Sounding Board: IDC's Forecast for Management Survey 2009

Sounding Board: IDC's Forecast for Management Survey 2009

Australian CIOs respond to the latest Forecast for Management Survey from IDC

An interesting aspect of the survey is to see where people have been squeezing. Traditionally, vendors tell you that you must stay on a supported platform, and therefore you must pay maintenance. But sometimes the value proposition doesn’t work.

If you’ve inherited systems that have been heavily customised or ones where there hasn’t been a lot of business involvement, in terms of stakeholder management and sponsorship and ownership from the organisation’s functional units, then there isn’t a lot of appetite to pay for maintenance. There are clearly companies who don’t mind if they run the risk of not paying exorbitant maintenance fees to vendors.

The other thing I found interesting was the consistent numbers around the use of collaboration, unified communications and videoconferencing to bring teams together in a virtual manner. When we moved into our new building, both here and in the US, we invested in unified communications, desktop videoconferencing, room-based videoconferencing and more. But we’ve taken a low-key approach. We’ve put all the investments in place and then tried to get things to spread through word of mouth. We’ve had reasonable success there and it appears the groundswell is starting to build.

Peter Palmer, CIO, Veolia Environmental Services
IMPROVED PERCEPTION OF IT

The immediate thing that stood out to me was the five per cent for IT cost versus revenue ratio for budgets. In the sort of companies that I deal with, and have been dealing with for more than 15 years, it’s nothing like that. I think the numbers may reflect a focus on the banking and finance sector, but given my focus on manufacturing, distribution and logistics, I think that’s an aspirational number.

Looking at systems and hardware, you can see that Moore’s Law is holding up very well and costs are still driving down. Indeed, there’s been some very interesting technology over the last year, especially in the area of SANs [Storage Area Networks]. Some great SAN technology has suddenly hit the market, both in the way the density of disk storage has improved, but also some of the software to manage the whole environment. SAN replication, for example, lets you build DR strategies very cheaply, which in turn drives down the cost of your hardware and software farm.

Some things did surprise me by not making the list of Top 10 CIO challenges. I agree with controlling costs being at the top of the list, but I would have thought alignment with the business would’ve been higher than it was. Another thing I was surprised didn’t make the Top 10 was benefit realisation. It seems to me this is the ideal time to be looking at the technologies that you have installed and looking at how you really get the benefits out of them. But when I looked at the charts about the perception of IT, I was really encouraged; 90 per cent of respondents view IT as adding value to their business, either by making a positive contribution to operational capability or as a source of competitive advantage.

Another interesting figure was network costs and seeing how they jumped. I really don’t see how network costs could have jumped by a factor of four, which is what the survey shows. If it’s true that network costs have jumped by a factor of three or four in the past year, then maybe my T2 shares are worth hanging onto. . .

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