The predicament of the IT manager, IBM's last Olympics and Germany's e-growth

A number of recent surveys and reports indicate that it is now harder than ever to keep a job in IT. Should we be surprised at these findings, and much more importantly, how worried should those working in the industry and business in general be?

Traditionally the IT manager has found himself always in the invidious position of gaining visibility only when things go wrong. On those (rare) sunny days in the past when all systems were up and running when the help desk was dealing only with the usual background rumble of "I've forgotten my password" and "my printer's not working" calls the average IT specialist rarely received any praise.

However, should there be any 'events' going on that were impacting service to users, the Man in Grey could expect, with a large measure of confidence, to become the target of all manner of comment (both verbal and electronic) denigrating the skills, dedication and effectiveness of his team. This is still the case today. However, we now have the ebusiness effect adding to the burden.

A survey by IDC for Vertical Sky, a web content company, has reported that some 73 per cent of companies with significant ecommerce revenue (over $200m) have had at least one site outage within the last half year. The list of potential causes for such outages is almost limitless and includes software sugs (cited by a majority of companies), software upgrades, hardware failures, telecoms failures, security concerns and many others.

Unsurprisingly, IT managers often carry the responsibility for these failures. Such outages of e-service usually cause a company to suffer financial losses, either directly through fixing the problems or compensating customers but the biggest cost may be in loss of reputation. It is this later problem that IT managers fear the most. This is the outcome that can lead to a P45.

It is true that IT managers are responsible for the running of their departments and the services they provide. However it is also fair to point out that there may be a number of 'business decisions' that have influenced the particular implementation that has experienced downtime. These decisions may have been taken under the influence of many factors, possibly against the IT manager's advice. Under these circumstances everyone involved in ebusiness needs to look at their own house first, after all, people who live in glass houses should not throw stones.

Gone for Gold

Four years after a disastrous showing in Atlanta, IBM appears to have had a complete success in this year's Olympic Games in Sydney. Not only is its website breaking all records for page impressions but it has stood up to the test without any major problems and no code changes. Since IBM has chosen not to continue its sponsorship of the Games after 2000, what do we have to look forward to for future games?

IBM first became a sponsor of the Olympic Games in the winter of 1960. By so doing, it earned the right to use the Olympic Rings in its marketing materials. In the 40 intervening years - especially since the advent of the world wide web - the IBM logo has become as much a part of the Olympics as those five rings.

However, Atlanta 1996 changed all that. IBM bet on a raft of new technology that ultimately let everybody down. On the first day its system ground to a halt leaving the world media unable to report actual results while results for events that had not even taken place were being reported. Most intriguing of all was the report of a boxer being 21 feet tall. By 1998, it had decided not to renew its agreement with the IOC.

The problem for the IOC has been to find suitable sponsor replacements. Who, other than IBM, could possibly provide the hardware, software and services required to put together possibly the world's largest information system? Surprise, surprise - there is no single supplier that could take on the job. Now, the IOC is going to use three separate suppliers - one of which is Gateway.

This is going to raise all of the problems of internal politics, integration failure and inadequate testing that were blamed for the Atlanta failures. This time around, IBM has proved that a single organisation needs to take complete control for such a project to succeed.

IBM has proved that being a key technology supplier to the Olympic Games can be a massive marketing opportunity but it can also be a banana skin. The IOC's idea of having three different sponsors and expecting them all to work together seems altogether far too hopeful.

German net growth

Research by PricewaterhouseCoopers (PwC) has indicated that nearly 45 per cent of Europe's internet business capital is to be found in Germany. At the same time, over 50 per cent of the German businesses surveyed were profitable while others found funding much easier to come by.

This will come as a bit of a shock to some UK businesses that usually see themselves as the leaders in Europe. In their favour, the UK dot-coms appear to be better managed with much lower burn rates than their competitors on the mainland.

PwC maintains an index of the 150 top net businesses in Europe, covering some 98.6 per cent of the total capitalisation. These are businesses that have been traded publicly for some time and rely on the internet for at least 50 per cent of their revenues. Unsurprisingly, many of these businesses are ISPs and account for a major part of the revenues. Software and services suppliers also feature quite prominently, although it is the ecommerce businesses that are growing fastest and are showing good levels of profitability.

In addition to having more and bigger internet businesses, German organisations have raised over one third of all the funds handed out to start-up businesses since the beginning of this year. Much of this success has been put down to the influence of the Neuer Markt making fund raising easier for high technology businesses. And today there are around 18 million users of the internet but that figure is expected to grow to nearly 40 million before the end of 2001 - almost half of the total population.

The average burn rate for non-profitable businesses is around 20 months with large portions of funding being spent on expensive sales and marketing campaigns to win customers and create critical mass. It is here that the UK has improved significantly with some large reductions in burn rate that might help them to succeed through longevity.

It seems that the German net economy is succeeding partly as a result of failures in other parts of Europe. Its nearest competitor, the UK, is still struggling to provide telecommunications charges that are an encouragement to web users rather than a barrier.