Cash for Business Process Clunkers

Michael Vizard

As everybody from academics to factory workers fret over the prospect of a jobless economic recovery, now might be the time to take a good long look at the state of business innovation.

If we're ever going to return to true economic vitality, then we need to encourage businesses to innovate. We all know that there can be no significant innovation in terms of a business process that doesn't involve IT. And yet when we talk to senior IT executives, it's pretty clear that most of the IT focus today remains squarely on cost-cutting.

Case in point is the activity that Micro Focus is seeing within its customer base. According to Micro Focus president for North America Ken Powell, the vast majority of customers using his company's COBOL tools are involved in application renewal projects. Business is good, he says, because application renewal is counter-cyclical, which is to say customers are keenly interested in lowering their costs by moving COBOL applications off of mainframes and onto a lower-cost platform. If the economy was really good, Micro Focus would be seen a lot more customers focused on extending the COBOL applications that anchor their core business processes to support new business processes. Unfortunately, there's not much in the way of those types of IT projects going on.

The reason for this has to do with the general shortage of capital and the simple fact that most business executives are suffering economic shellshock. They are so focused on just trying to hold on that nobody is really pushing anything approaching an innovative idea that might take more than 12 months to come to fruition. Inevitably, this leads to a level of stagnation that is going to require some sort of outside stimulus to get things rolling again in the right direction.

So with the Federal government doling out money for every conceivable stimulus program imaginable, maybe the time has come to create a program designed to help corporations leverage IT to drive business innovation. A special agency could be set up to review proposals in much the same way that grants are reviewed. Projects that would stimulate jobs and eliminate outdated IT infrastructure that spews carbon into the environment would be given the highest priority.

Whatever approach is taken, it's pretty clear businesses today need something to shake them out of their doldrums beyond waiting for the return of available credit once the banking system straightens itself out. Unlike most of the stimulus ideas making the rounds in Congress, a cash for business process clunkers program as a way to kick-start the economy at least has the merits of rewarding innovation that will beget even more innovation, as opposed to say bailing out a specific vertical industry such as the banking industry and then hoping they then do the right thing with the money.

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