Ebusiness Despatches: Why I hate IT scaremongering

Rene Carayol, our columnist at the frontline reports back from three conferences - a tale of ebusiness past, present and future?

Many of you will by now know one of my biggest hates is IT vendors using shock tactics, scaring users into buying certain products or services. The lie of the land became plainly clear at three conferences I spoke at recently, each put on by a different top tier IT company.

The tech giant hosting the first get-together once could do no wrong. For over 20 years it was a fast growth stock, posting quarter on quarter profit increases - without fail. It had never been through a recession, at least not a recession in its market, which means it never really had to sell.

But over the last couple of years its share price has fallen from around $60 to under $10. Its notoriously aggressive salesmen are pausing - for once - scratching their heads and wondering what to do. They used to have eager customers queuing up and the only problem was whether back at the plants the boys could produce enough kit.

How times have changed. Across the world there is massive over-capacity in many tech markets and this company's is no exception. It is like the automobile sector. Last year 75 million cars were manufactured but there was only demand for 50 million.

This all means customers can play hard to get and get better deals. If you're not, by the way, you should be.

For vendors, the lesson here is that they must have the structure and personnel to manage through bad as well as good times.

While the first event I attended was worrying, the next appalled me. One of the biggest vendors was preaching IT fire and brimstone - if users don't do what it says they'll go straight to hell. It's the kind of scaremongering that's become common over the last five years.

First, we were told Y2K was make or break, and so we spent. Then we all had to become ebusinesses, following the lead of the dot-coms, many of whom we now know got it wrong. So we spent some more. Even more recently, we've been told to prepare for a wave of telecoms advances, getting our businesses ready for GPRS, 3G, consumer broadband and more. Only now we're not spending quite so easily.

The theme of the second conference was safety and security. I won't deny these are necessary but no wonder certain companies' credibility is shot to pieces if the only way they know how to sell is to scare.

But at least my third stop on the circuit gave me hope. Yet another premier league vendor but this time an enterprise software company with a simple, respectable approach. At its event it didn't try to sound user alarm bells. It spoke about how it can enhance businesses and, from where I was sitting, showed a lot of confidence in its products and services.

This was a company that understands scaremongering ultimately doesn't work and has learnt how to sell in difficult times.

Perhaps the major point was that I met salesmen who are comfortable selling to a CEO or CFO, not just CIOs. They understand businesses - rather than just systems - that well. This is the future.

That was a heartening third leg for me but there are other positives to be taken here. Users are becoming more discerning and want more evidence as to why they should spend with a particular vendor.

A typical approach is for an IT director now to award a contract which starts with a single department. If - and only if - this goes well, the contract extends to the whole business. More success and the technology or services are rolled out across a supply chain, bringing in partners. Finally, a vendor that passes these labours of Hercules gets to work on lucrative new market opportunities, the IT Holy Grail.

Users now understand they shouldn't be panicked - as they have, even in the recent past - and make uninformed decisions.

If this sounds overly bleak, overly difficult for the vendor community and all their partners in the channel, then it shouldn't. There is still business out there for the good ones. Remember the car industry. It may have chronic over-capacity but there are a few manufacturers out there posting record profits.