The Ovum View: The reality of end-user IT circa 2002 - PART TWO

Risk reduction

With confidence in end-user IT at a low ebb, risk aversion has set in. More emphasis is placed on pilot projects and phased roll out of new technologies. End-user organisations will 'dip their toes' into new technologies on simple, well-bounded projects before taking on more ambitious tasks.

End-user organisations are also much more concerned about best practice - they are keen to learn from the experience of others. This bodes well for systems integrators that can demonstrate a track record of successful deployments. It also highlights the need for vendors to be able to provide access to advice, either provided by themselves or via partners, to support the adoption and deployment of their technology.

One of the effects of this more cautious approach to adoption is a much more gradual increase in expenditure on technology. Not only will initial sales cycles be longer, early revenues will begin low and grow as confidence increases. This means vendors will have to invest more effort over a longer period in order to maximise the revenues from any given client. The days of grabbing a purchase order and running away are over.

'Shared risk' agreements from the smartest vendors
The goal of technology suppliers should be to create a spirit of partnership with their clients. In most success stories our clients cite the relationship with their supplier(s) as one of the key reasons for success.

Partnership depends on establishing common goals, a willingness to share the risk and reward, and (of course) a high level of mutual trust.

Consolidation and simplification
Faced with the array of 'great ideas' that make up the tangled mess that many IT departments have to live with, there is now more focus in Europe on reducing the complexity that developers, administrators and, all too frequently, the users themselves have to deal with.

There is a tacit understanding among IT managers that complexity can never be completely removed from a system but they do want to see evidence that technology can help them manage that complexity - ideally hiding it from developers and end users.

One of our US clients, in manufacturing, echoes a sentiment felt by many when she says: "Middleware was supposed to hide the complexity created by heterogeneous systems, not expose my developers to more complexity of a different kind!"

'Replace' is no longer a viable option
In large organisations, the simple truth is that client-server technology did not result in the elimination of their mainframes and Java has not brought about the decommissioning of their Cobol applications.

Budgetary constraints, coupled with an aversion to the risk that 'big' software development entails, mean that few organisations are now motivated to rewrite their core applications using newer languages and technologies.

Fresh emphasis on legacy applications in 2002
Cobol is undergoing a small renaissance, with a shift in objectives from 'replace' to 'renovate'. This bodes well for the near-dormant Cobol development tools market and for suppliers that can make it easier for end-user organisations to integrate their legacy assets with the outside world.

Many of our larger clients see web services technology as a strong candidate to enable this process of opening up the mainframe.

This research is taken from the SoftwareArchitectures@Ovum Advisory Service. For more information email info@ovum.com or visit www.ovum.com