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Is Today's IT an Undervalued Asset?
mwillems asks: "I work in the technology industry, as a CTO. What I have increasingly seen in the last year, both in North America and Europe, is that IT has ceased to be a valid way to spend corporate money. IT spending used to be looked at as a way to gain competitive advantages. Since the .com bust, the arguments I hear everywhere is 'IT has now been proven to be a waste of money'. At many companies it is now easier to get a corporate account at a strip club than a new PC. Or a budget to develop a much-needed corporate app. If any spending is done it is on hardware - at least that is 'real'. Do Slashdot readers recognise that? Are there going to be many techies left ten years from now? What can we do to keep the spirit of innovation alive while this 'IT is bad' era lasts, and how can we make it end? And, how do you prove the value of IT? This is not as simple as it seems. Try it with a spreadsheet: as your typical CTO has to do so, every day."
How do you feel about the cost benefits of IT? Is it worth what your company spends on it, especially if the advantages can't be reduced to a simple dollars-and-cents figure?
Most people in the tech industry are going to fade out. Thus, leaving the majority of workers those who have been around before the .com boom. Bigger salaries and more work, instead of the bloated staff in a lot of IT departments that you saw during the .com boom. Personally, I'm glad to see it. I know plenty of people who shouldn't be in the IT field. Luckily, those are the ones finding other professions or reverting to their previous professions.
Dacels Jewelers can't be trusted.
Most firms now realize that they can survive another year without upgrading their router or servers, which were either so expenseive originally that they simply must sit in the rack room longer, or are "good enough" even if they aren't the latest model.
Software is a whole other story. Most companies realize now that upgrades are a scam.
On top of all of this, many buyers realize that the latest tech will simply make them part of a large beta testing mob, where their old tech is now largely debugged and productive. Certainly MS users understand this.
I love working on IT, but let's face it, this is just like any other department in a company. Many of us have seen the total waste of $$$ that an IT manager will sell to the higher ups - sometimes just to work with new technology, etc.. The fact of the matter is that at a typical company, IT budget is not seen with an eye on monetary rewards. That has changed recently. Business rules state that if a secretary does something well for 30k a year, don't spend 200k to eliminate his/her position as it is not cost effective (even 100k is too much because it probably doesn't include maintence costs and the cost of changing business rules (which is much more expensive for software than a secretary)).
This is easy - innovate. Don't just buy new hardware and upgrade software, do something that IMPROVES life at the office. There's more to IT than scalable switches and making sure that you can ping the server. Come up with new applications of the technology and make yourselves valuable.
Create your own value, the rest of us have to do it.
This may not be a popular opinion but I really don't think the majority of corporate users NEED a new pc very ofter. I'm a full time software developer and I'm perfectly happy with my "ancient" PII 400... Granted there are always exceptions to the rule, but for the most part I think new PC purchases should be scrutinized.
They who would give up an essential liberty for temporary security, deserve neither liberty nor security
The late 90's: All Tech Spending is Good
:)
The early 00's: All Tech Spending is Bad
It's oversimplistic reactions to the problems that came from tech spending in the 90's. Many people were creating products that were full of pizazz that didn't work for crap and people bought them because they thought technology was their salvation. Well guess what, technology isn't a magic pill, and anybody who claims ANYTHING is a magic pill should be taken out back and shot.
So now today, everybody is gun shy and overcautious. A company gets burned in the 90's converting their billing system to some flaky electronic system that has cost more money to keep together than your old system. Today they get the choice of buying yet another new system, taking the same risks again, or sticking with the known quantity. At this point, with money tight, few are willing to take that risk to get it right the second time because they can't afford to get burned this time.
Over the next few years as a recovery slowly works its way into the system, some people will feel that they can take some risks again. Those flaky systems will have long since been purged from the software gene pool and there will be good products that people will be able to trust. We'll actually begin to see those efficiency gains that were supposed to happen during the 90's hype and the world of IT will be back in business.
Until then, batton down the hatches and hang on tight
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IT is a value added resource in most companies but, sadly, in most companies it really doesn't directly contribute to the bottom line of profits vs. losses. IT's value is in making the employees lives easier without intruding on the day to day operations of the company. This tends to a be a cyclical trend based on two factors. The first is arrogance and the second is repentance.
The arrogance factor is what drove IT spending a couple of years ago. In essence, it is drawn from the idea that for the vast majority of corporate America IT organizations have tended to view themselves as being "The Reason for all Existance." CIOs, and the organizations they represent, develop an over exagerated opinion of their place in the world. The inevitable happens when the CEO realizes that spending a third of the total corporate budget on new computers still means he has to use Microsoft Office.
The repentance factor happens when after the arrogance factor has disappated and IT spending has flushed itself down the toilet. Computers start breaking and the two guys who program in COLBOL either retired or died. The peasants rise up in arms and the CEO takes notice, realizing that just maybe he needs to up the dollar count before he drives his company out of business.
These two cycles make up the Hebrew Cycle of Corporate Management, or HCCM for short. This is named after the relationship that God's chosen people have developed with God.
In a couple of years, when processes start breaking and computers get older causing more downtime than otherwise necessary the trend will turn around.
Beware the wood elf!!!
Fortunately (unfortunaely for some) this will be the trend for a few more years while the untalented IT workers fade away. Before the boom, IT and IS had qualified workers. Then the web took off and my grandmother became a VB programmer b/c she's one of a few americans who can program her VCR. This led to calling HTML monkeys 'programmers'. Then the era of dot bombs and an increase in failed IT/IS projects came along.
/dev/null then it does being productive. Basically the same reason why the majority of americans are afraid to invest money in the market today.
Of course companies are tenative on dumping money into IT becuase the money still has a better chance winding up in
A few more years when the unqualified IT/IS staff go back to ringing up Big Macs(tm), faith in IT/IS will return to normal. In the mean time, if you are good, just hang on and and do your best.
Also, as we get a few years older, more and more people (employers, co-workers, and ourselves) will understand the role of IT and our field will be better defined...thus better 'trusted'.
There are many problems that have erupted in IT since the .com boom. These may or may not have been around before, but they are definitely known now.
One of the biggest problems I see is that there are many managers of IT departments who are just that - managers. Think of the pointy-haired boss in Dilbert. Just because someone is a manager doesn't mean they know the first thing about IT. I'm not advocating the promotion of your average IT nerd in place of them, but there are always a few people who have both management skills and IT knowledge. A good manager passes things off to the big bosses as good ideas. If he (or she) understands what he's working on, then they will probably be good ideas. If he doesn't, then they will be things that look good on paper and get him more funding. Nevermind that it makes the people below him aggrivated. It makes him look good, and gives him more money to spend on his desktop toys.
I have seen this problem in action. It's always fun to get a blank look when you try and explain the simplest of tasks to these people. It's like trying to explain matrix algebra to a 3rd grader, only with less chance of success.
Another problem I've seen is that, in the name of saving money, people buy inferior products. Some manufacturers are more reliable than others. Before ordering 100 systems from a company because its "cheap", it might be a good idea to order 5 of them and test them for a month or two, and see how well they perform. Maybe even order 5 from another company to compare them to. Also, ask the people who regularly maintain the ystems which kind of systems they have the most problems with. It might be a good idea to get their advice on who to order systems from. Then you will avoid problems like the one I have seen recently, which involves losing more than 1 computer a week to hardware failure. These computers are not even a year old, and still under warranty, but it still causes problems when you have 4 more break before the first warranty part gets there.
Hopefully, the cutting of funding to IT departments will drive off people who are "in it for the money", like these managers without IT skills, and also will cause people to take more care when selecting computers.
"Who am I" and "Why are we here" are not the problems.
The problem is when someone asks "Why are they here."
This was going to happen since nothing can stay badly broken forever, not even Microsoft Windows.
The success of IT rested on three assumptions:
1) The Internet was a cash cow that needed only to be milked.
2) Microsoft Windows was the key to all things in the computer world.
3) IT staffing is always needed to service the legions of PCs in business.
But each of these failed to pan out for logical reasons. The Internet was a cash strategy, but was abused by stupid people placing money into businesses without a business plan and no real product--dot-coms. Bye-bye, they said to their money. Screwed up the stock market, that.
Microsoft Windows was indeed the way to all things computer-related, from apps to training. And quite a few businesses contracted with "kitchen-sink" computer service companies who could buy, service, or administrate all kinds of PCs (unless you're Mac OS or Linux--that's another sad story in most locations). And training would guarantee most everyone with certification the chance to submit their resumes.
But this business was based on the fact that Microsoft Windows was ALWAYS in need of maintenance and companies would ALWAYS upgrade their systems for the "latest and greatest."
Enter Windows 2000--the first Windows OS whose stability and performance claims were justified. Microsoft built this OS with greater strengths as word spread of a newcomer that was free and just as stable: Linux.
As budgets tightened, managers again asked the budget questions, but weren't accepting the usual answers. "Why do we need to upgrade?" IT managers were able to answer firmly in the past that these upgrades would improve performance, or administration. But managers knew, now, from personal experience that their computer running Windows 98 or 2000 was just fine, and didn't want their copies of Office 2000 messed with for now.
As the IT monies dried up, IT managers (and contractor companies) tightened their belts and downsized, kicking out some experienced techs but quite a few inexperienced (but certified!) techs to the curb. Windows didn't need armies to support any longer. Servers didn't either--a few new technologies consolidated some sysadmin functions.
And now we're back to the availability of techs and sysadmins with real experience, talent, and diversity. You could be a Windows NT admin, but you may also know Linux. No longer was there room for "computer religion." You might do Mac desktops, but also know PC desktops. It's a screwy kind of Darwinism (no pun intended for the OS X folks), but the competition between the stable UNIX operating systems vs. all things Microsoft have brought a new (or rediscovered?) dawn to the personal computing world: the generally stable computer.
Are techs still needed? Sure. However, if all you have are a bunch of certification certificates beyond you and little experience, those papers and 50 cents are probably worth a cup of coffee at McDonalds.
Vos teneo officium eram periculosus ut vos recipero is.
What about all of the power to power your precious machines? You ever thought about that? I'd guess that 80% of all companies today could *get by* without a computer system, just as they did years and years ago. I'd guess that 0% could get by without power. Yet, you don't hear the electrical engineers saying "I bet they'd appreciate me if I shut down this transformer". Please. Grow up.
Only at some companies.
I'm guessing that some of the big decision makers got burned by some bad decisions during the heyday of the .com boom.
You have to admit they have a point. They were sold on something which
- they know absolutely nothing about (have an MBA, not an BS CS)
- which turned out to be a dud.
Why should they believe the next hyped up set of buzzwords coming from the IT community? (Certainly they should be skeptical of the same vendors that sold them that previous pig in a poke, whoever they happen to be - hopefully not you!)So first dispel any illusions that every new buzzword technology is a good thing.
Also, gain some credibility with those skeptics by validating their skepticism where it was well-founded. Yes, we sunk thousands of dollars into that supposed cure-all and it was nothing but headaches. It was mistake and you're right to call it a mistake. But also point out where things went right, or perhaps unexpectedly right (eg, Joe put in an open source proxy server that was the bees knees.)
If a vendor comes painting a picture, demand references to current users, and then dig down to the worker bee level in that organization to see if things really are working. Why dig? There's probably plenty of upper level folks in the showcase example company that want to look as if they made a good decision to go with vendor Y and technology Z. The CIO doesn't want to look bad to the other C level people, so definitely dig down. I can't tell you how much money has been poured down holes as a result of an uninformed decision coming down from on high, where there is too much insulation from everyday reality of things like hung servers.
You need to back things up with solid arguments showing non-IT folks how introducing some technology helps their business' bottom line.
A worthy competitor that has implemented technology X where you can show it has had a beneficial effect is one good argument. Another argument is a detailed analysis of a small low-budget prototype roll-out: eg, we created an XML based mechanism for tech-friendly Salesman Fred to access the manufacturing database so he could know how much leadtime to let a customer know he could expect. Etc.
In the big overall scheme of things I've heard an argument made, and I believe most of it, that the unexpected growth in productivity over the past 15 years or so has been largely due to the adoption of IT. (Some growth is due to improved business processes, but I would argue that many of those processes wouldn't be possible 20 years ago given the technology of that day.) If you believe that, then stopping all further investment in IT will likely lead to a stagnation in productivity growth and profitability.
Nothing's ever that simple, of course, and there's no iron-clad arguments for adopting new technologies. There's risk, no two ways about it. But taking the risk earlier than others leads to more substantial rewards, if you can afford the investment.
"Provided by the management for your protection."
This one is pretty obvious - you have an IT network, you have to keep it running. You have existing software that is providing some sort of value, you must keep it running. Maintenance means replacing broken/failing equipment, it does not mean constantly upgrading to the latest gadgets. This type of IT spending is currently way to high. NT4.0 is good enough. Office 97 is good enough. There is no compelling need to upgrade to newer versions. When we upgraded from office 95 to office 2000 the only reason to upgrade was because of the compatibility issues. And this only affected about 1% of the office! This is not money well spent.
This is a bit more complicated. Actually it's a lot more complicated. Most businesses have been doing things one way since the beginning of time. When asked why they do something the answer is usually "that's how we've always done it."
Spend a few days looking around your corporation. Maybe you can apprentice with some of the Secretaries/Assistances for a few days. Learn their processes. Find out why they do things... question everything and look for redundancies. It probably won't take you long to find cases where people are re-keying information that has already been in the PC once. This type of work adds no value - if there is a significant amount of time spent doing this you can easily build a case to correct this. Start a project to extract the data from its original home, put it in a format that your clients will be able to use. These are the easy projects to get approval for - low political risk, high pay out.
Another way to find potential IT projects is to spend some time trying to trace processes from the original entry into the company, to the final delivery to the customer. Create a complete processes map. Find out what the original input is, and what the eventual output is supposed to be. As an outsider you should be able to look at the process and see major areas that could be improved. Anything that doesn't add value to the final product (in the eyes of the customer) probably does not need to be done.
Focus on areas where a customer request passes between many different people before it is filled. There are usually ways to improve or eliminate hand off time. Possibly there are many 'specialists' involved in a process when really they need one generalist and an expert system. These types of projects are difficult because many business units will need to cooperate to accomplish an improvement - but at the same time this is where the highest return can be.
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- Greedy.
- Lazy.
- Incompetent.
Greedy. I constantly see internal web development groups quote even a tiny, simple web site as dozens of hours and thousands of dollars, a price that would have been outrageous even in the pre dot-bomb days. Then they have the never to say "Why do you care how much we bill? It's all internal chargebacks, so it's really just 'play money'!"Lazy. All too often, in order to complete a project on time, I end up building and maintaining my own servers instead of handing off server installs and maintenance to the in-house "server management group". Why should the internal sysadmins be pro-active when there is no penalty for slow response time, no competition for customers, and when they know that by doing nothing, the most demanding customers will eventually just go away and solve their own problems?
Incompetent. As firms cut down on staff and cut out the perks, their most qualified web developers and sysadmins are recruited by headhunters or flee to better, more stable positions as each round of downsizing takes it's toll on morale. In the end, with very few exceptions, the only staff who remain are those not talented enough (or too apathetic) to move on to a better job.
In my experience, in many larger organizations, IT staff might once have been an undervalued asset, but in the past year, most of the valuable staff have fled for greener pastures.
I do not deploy Linux. Ever.
"IT" always represented this flashy thing where the company was paying a bazillion dollars to move everything to platform X with some flashy vendor and new "in" technology. This type of IT is dead. It's dead because people started to see it as an end in iteself, and somebody finally asked "where's the bang for the buck in our core business operations?"
I've always felt that simply polishing the hell out of your internal apps is the best way to spend money on IT. It's pretty easy in most business system to find ways to take business functions that take a minute or two but are done by several hundred / thousand people a day (or more) and reduce them by 50-90% time-wise. If those take a month or two each of programmer time, that is big-time ROI.
Lets say the programmer makes double what the typical business process user costs. If it takes the programmer two months to do a project and the net result is that a business function/transaction occurring 480 times a day is cut from 90 seconds to 30 seconds, then the project pays for itself in four months. That kind of work isn't sexy, but it sure does pay for itself, especially when departments can delay hiring more people because their existing folks are more productive.
There are a lot of crappy apps out there that waste user/customer time, especially because IT managers were hell-bent to shove new apps out so they could claim victory in the time-to-delivery game. The whole IT industry needs to step back and focus back on the end user experience and business fundamentals: eliminate waste in core business processes.
IT has a reputation in corporate America as the most unresponsive and least human-centered department in any organization. Here are the stereotypes I've encountered:
1) IT people are more interested in their machines than in helping me do my job.
2) IT people have no understanding of what I do on a daily basis.
3) IT people are penny-wise and pound foolish. They won't pay $200 so I can have a Zip drive that will allow me to take my work home, but they'll spend $1.5M on a VPN that will take a year and a half to implement and won't work properly when finished.
I've been on both sides of the fence, serving as IT support and being one of those people griping at poor IT support. It seems to me that if more IT departments thought of themselves as enablers rather than as an end to themselves, they'd receive much more respect.
Want to see a good example of how it works in a good support organization (and IT is always support)? Go to your nearest Air Force base and talk to the pilots and crew chiefs. Sure, the pilots get all the glory, because missions are oriented around flying the aircraft and hitting the target. But the crew chiefs are given tremendous respect, because they are responsible for making sure the aircraft fly properly. They understand and take pride in their role.
Many IT folks seem to have the opinion that they're smarter than the people they serve. They may be smarter, but that doesn't change the fact that people above them in the organization have to make the truly difficult decisions about hiring and firing, where to spend money, how to stay competitive, and so on. It's not that IT decisions aren't difficult, but in any organization, the more important the decisions you make, the bigger your salary.
If more IT departments realized that they actually are part of a larger team supporting the same goal, and took off their wizard's hats, they might find a lot more acceptance on a human level.
That's where IT folks commonly fall flat on their faces. They don't realize that business people make decisions based almost exclusively on human factors, only secondarily on money, and a distant third on technical factors.
IT departments that grasp the human factors, take care of the other people in the company, and bend over backwards to help people go about their daily tasks are far more likely to get the money they need to conduct glamorous "innovative" projects.
Read the EFF's Fair Use FAQ
One of the reasons for this bust is that people were spending money on IT stupidly. I'm sure we all know a few people who have insisted that they need a new computer because their old pentium is "impairing their productivity" when all they really do is word process. And let us not forget this sub-moronic idea that just because M$ comes out with a new version of office, you need to have it in order to keep up. The result is that companies have way more features in house than they can typically use, which translates into wated money.
Now tell me who out there is naive enough to think that the people running the show are sdmart enough to learn that IT is a worthwhile investment as long as it is well thought out and carefully implimented? Reactionary attitudes tends to be the norm in just about everything everywhere. Right now the pendulum is in the process of swinging back towards a cut corners mentality, which is good to a certain degree.
"We can't install the latest release of Windows/Office on our old k6-2? Why can't we just use the old version?" That's intelligent thought, and as techs, it should be up to us to answer that question. I truly believe there will come a time when we are no longer in a recssion, and invester confidence has returned, and when that time comes, the people who approve budgets might be willing to listen to and consider your answers.
Until that time comes, you're just going to have to accentuate the negative. If you need to develop some app, but there is no budget, then make sure you accurately predict how, in the long run, not devbeloping it will actually cost your company money. When enough techs are proved right often enough, then the pendulum will start to swing back the other way, of course this gives us all an even mightier responsibility; to learn from the lessons of the past 6 years and NOT try to solve every problem with something newer and "better."
In the late eigthies, you still had to write almost every application if you required something like a workflow and wanted the system to be used by mere mortals.
Today, one person alone can set up an integrated office system with document management, customer database, accounting, reporting, E-mail access, firewalls, printing, backup, telephone integration, banking, video and audio editing, ftp and webserver, dns, dhcp, wavelan, gigabit backbone, raids, computing clusters and mobile vpn access within weeks, and several hundredthousand apps are available for free or very little money. You can easyly afford a database software or an office-suite worth a few hundred million dollars of develepment effort, and get even millions of man -months delivered on a $50 Linux Distribution, including the source code. Or if you buy a Mac or a PC today, you can actually do useful things without even installing additional software - remember, what you could do with an AppleII out of the Box ?
So today, if you want to roll your own stuff, or even spend a few days on improving your customer database access, you need many thousand customers to justify even using a real database instead of MS Outlook contacts or a simple spreadsheet.
Trying to build a new 3D-Engine, a Web-Browser, a database engine or a new GUI library is almost insane from a business point of view, so the deeper you descend into the swamps of IT-Development, the better your justification has to be for shelving out that money and taking the risk of failure.
I try to ride Moore's law and aim for something unique that does not exist so far because it was impossible or too hard to do in the past. I try to stay current by spending a lot of time hands on new technology, and I steadyly improve my and my team's knowledge and skills, but I admit: it is increasingly harder to find and exploit those niches where you have both: Fun and Profit.
OTOH, there will always be the Linus way: Build something for the sheer fun and knowledge, and the worst case is that you are happier and smarter afterwards.
And if you don't mind to listen to someone who has been around for a while and covered some distance: Never do things for the only purpose of profit. It will minimize your chances, but even if you succeed, you will not be any happier than today. And probably have fewer friends.
parabyte
Without order, nothing can exist. Without chaos, nothing can be created.
The obvious conclusion is that it, Microsoft, is the root cause of the problem, because the things that corporations are complaining about are in fact characteristics of Microsoft Products.
Microsoft products are used through out the industry, and are the standard. Are they not? Whose software is left to blame?
"It is a greater offense to steal men's labor, than their clothes"
If this were true, please explain:
why we are using word processors instead of typewriters or movable type presses.
Why spread sheets are needed? We could use register paper instead of an expensive computer.
Index cards are cheaper than databases. Lets go pull the plug on that expensive DB server.
Customers and vendors don't really need to do stuff with our web site, they can call in to our customer service lines. Oh, we'll need more bodies in customer service...
Who needs e-mail. Snail mail is fine for what we do...
Why should we search the web for the best prices, just order catalogs once a year and go to the public library more often to do research.
Now that we've deflated the hype around computers, lets talk about telephones, fax machines, pagers, and cell phones, and why we don't need them anymore.
After that, if they back off, then ask a simple easy question: Do you think any of that stuff runs itself?
Seriously, if anyone said that IT has been proven to be a waste of money, I'd look for an ulterior motive. Fast.
Now, if they mean that a lot of people went overboard, well, I don't think I could argue against them there. One only needs to look at Darwin Awards to see that a lot of people do go overboard... and kill themselves doing it. The trick of it is not to be a lemming.
Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves.