What Business Wants from IT: Squeeze Blood from Turnip?

Loraine Lawson

Forrester Research's "The State Of Enterprise Software: 2009" is generating a lot of headline buzz this week-but after reading every news article I can find on it thus far, I'm struggling to figure out exactly what it means for IT.


Frankly, I'm wondering if it boils down to advising CIOs to squeeze blood from a turnip.


There are a couple of reasons why the report has me scratching my head, but primarily it comes down to this: It strikes me as a list of wants with no clear indication of how companies hope to achieve them.


For instance, the report found - not surprisingly - that companies want to reduce IT costs. This seems to me the most clear finding from the report, with 81 percent of businesses saying they want to reduce IT costs.


But, a close second demand was better integration between applications, at 77 percent. Likewise, the top initiative for 2009 was updating key legacy systems.


Of course, both would probably save companies money in the long run, so in a way it makes sense. It's the short-term compatibility I question. If your goal this year is to reduce IT costs, then is this really the time to update legacy systems and undertake better application integration? Or could it be that companies expect IT to accomplish these massive tasks without added spending?


Perhaps the answer lies in the press release's quote from Jean Pierre Garbani, vice president and principal analyst at Forrester:


"The costs of operating monolithic legacy applications makes them unsustainable, and these survey results show that firms are seeking efficient ways to modernize. Companies are willing to adapt their business processes to cheaper packaged software solutions rather than wait for custom applications. Automation is the key to IT's future."


Certainly that was another finding in the report-companies prefer packaged solutions to tailored solutions or hosted or SaaS solutions. I was a bit surprised that SaaS came in last, considering the potential for cost savings and the report's finding about reducing IT costs. But apparently security concerns worry enterprises, and SMBs fret about the total ownership costs with SaaS.


Now, I'll grant you that the numbers who preferred packaged solutions weren't overwhelming-33 percent of enterprises and 45 percent of small and mid-sized businesses. But still, it makes sense that cost-cutters would choose a packaged solution over building their own solutions.


Except the research also found companies aren't planning to significantly increase their software budgets. In fact, software spending is expected to hold relatively steady over the next year, with enterprises allocating only 1 percent more than last year toward software costs, and small and mid-sized businesses holding steady on expensed software costs.


Plus, there's the additional contradiction reported by ZDNet, which apparently saw the full report, that "one key development is that large enterprises are increasingly interested in custom code."


So, I'm confused about what, exactly, CIOs are supposed to do with this information. Plan for unfunded legacy upgrades? Integrate applications with twine? Research software solutions that "sort of" meet the business needs and cost nothing to implement?


I hope Forrester publicly offers more concrete advice about the meaning of its findings. And perhaps the full report gives more concrete guidance. But from what I've seen thus far, it looks to me like CIOs would be just as well advised to start a turnip farm.

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