News in Review

IT staff turnover on the rise -

Outsourcing is increasing staff turnover significantly in Australian IT departments, according to just-released research from IDC. Staff turnover increased almost 4 per cent to 22 per cent last year, compared with the 1996 figures.

The survey, which has just been published in the 1998 Forecast for Management, IT Management Metrics and Technology Adoption, examined the activities and plans of IT departments in Australia and New Zealand.

IDC's manager of end-user research, Peter Hind, said the increase in staff turnover could see staff costs rise to the top of IT budgets.

"The increased work available for year 2000 projects is forcing up the rates that are offered to skilled staff, and there is a ripple effect," Hind said.

"IT personnel are conscious they can make more money elsewhere, and sometimes it's easier to leave and get a higher salary than it is to negotiate internally."

Asian crisis threatens government agenda --- Sue BushellEDS (Electronic Data Systems) says the federal government's whole-of-government outsourcing agenda is under challenge from the Asian economic crisis, takeover fever and wide-ranging fatigue.

And according to EDS government services director Tony Henshaw, that fatigue is proving a much more serious issue for SMEs (small to medium enterprises) than for the large end of town, which can always bring in extra resources whenever timetables pose problems.

"There is a danger that the industry will get fatigued. There is also a danger that the agencies will get fatigued. And there is a very significant danger that OASITO (Office of Asset Sales and IT Outsourcing) will get fatigued because while each of us chooses whether or not we play on a particular procurement, OASITO has to play on every single one," Henshaw said.

Of the impact of the Asian crisis on the outsourcing agenda, Henshaw said: "We all know that John Howard called the election in October because he thought that by March we would be in a much less positive state."

Successful outsourcers have signed up to penalties for failing to deliver export targets set as part of RFT (request for tender) responses, he said. This has made the prospect of the Asian crisis -- and, in fact, a European crisis now -- having an impact on export targets very significant, Henshaw said.

Meanwhile finance minister John Fahey told the seminar that if re-elected, the Howard government would not change its current position in relation to outsourcing and competitive tendering and contracting.

And opposition senator Kate Lundy said that if Labor gained power, it would review the entire agenda in the light of a new public interest test.

ACS slams GST on STD calls -

The Australian Computer Society (ACS) has slammed efforts by the Howard Government to apply the proposed GST to STD and mobile services as devastating news for the bush.

According to ACS President Prins Ralston, by taxing their communications, the Government was hitting rural Australians where it would hurt them the most.

"While we welcome the news that local calls will be exempt from a GST, this means little for remote users, who will bear the brunt of cost increases not only for long-distance and mobile telephone calls, but also for access to the Internet and other data services," he said.

The pressure is on: ACS -

The Australian Computer Society has renewed pressure for the Government and the opposition party to urgently release comprehensive policies for the IT industry.

According to ACS chief executive Arthur Dyster, Australia needs immediate intervention to resolve the critical shortage of skilled IT professionals through a combination of university education, encouragement of industry-based training and measures to attract skilled workers to Australia.

"We're calling on the major parties to provide specifics about their plans for IT, including how they will address the skills crisis and how they will grow the industry and attract international investment."

"Any vision for IT should also include the goal of creating Australian-owned transnationals which would underpin our local industry and help improve the balance of payments," he said.

Y2K hits local IT spend, study reveals -Australian IS managers believe the year 2000 problem is taking a heavier toll on short-term IT spending than their US counterparts, a new worldwide survey reveals.

According to Graham Penn, IDC Australia and New Zealand general manager: "While managers in both countries placed Y2K behind the impact of upgrading IT infrastructure and applications, the Australian managers certainly rated it as more important to their overall budgets than did those in the US."

IDC's 1998 Global IT Survey also reveals while many similarities exist between the US and Australian IT environments, proportionately, small business organisations in Australia have a larger operating budget than their counterparts in the US. However, medium-sized and large businesses in Australia have smaller budgets than their US counterparts.

Penn said this difference was likely to diminish over time as well, with Australian respondents indicating that they expected to increase their operating budgets by more than twice the rate of US organisations.

IDCs' survey offers information on end-user IT buying patterns, spending levels by industry, rates of technology adoption and Internet/e-commerce plans.

"For the first time, Australia has been included in this 15-nation global study, enabling Australia to be compared with other markets around the world. We now have extensive data on average IT spending, segmented by vertical markets, enterprise size and business complexity," Penn said.

Andersen Consulting bars new Y2K work -

As exclusively reported in ComputerWorld recently, Andersen Consulting plans to stop accepting year 2000 consulting work due to fears it could be sued by clients whose systems fail at the turn of the century.

According to an industry source, a "global policy" banning Andersen business units from engaging in further Y2K consulting activities was handed down by company executives. -- Cass WarnemindeMicrosoft said to have threatened Digital, killed project --- Rebecca SykesFive current and former employees of Digital Equipment have charged that Microsoft head Bill Gates forced Digital to abandon an Internet product last year, according to a recent report.

Last year, Digital was working with Oracle, Microsoft's archrival, on a prototype computer code-named Shark, which was targeted at the business and education markets, according to a story in The New York Times. Shark was based on the network computer standard developed by Oracle and other Microsoft competitors, and Gates pressured Digital's then-chairman Robert Palmer to drop the project, using as leverage Microsoft's intent to develop a version of Windows NT for Digital's processor, according to the Times.

Oracle Chairman Larry Ellison said that when Digital's Palmer told him in August 1997 that the project was being cancelled Palmer refused to say why, according to the Times. But Ellison quoted Palmer as saying, "If I'm subpoenaed, I'll tell the truth".

Officials at Digital, now owned by Compaq Computer, refused to comment on the New York Times story and to answer questions about why the Shark project was dropped.

Optus rebrands, loses again -- but less

Telecommunications carrier Optus Communications has lost $95 million for the year ended June 30 1998, up from a loss of $238 million for the corresponding period last year.

Releasing the results recently, Optus also moved to align itself more closely with the global branding strength of stakeholder Cable & Wireless, announcing a change of name to Cable & Wireless Optus.

Intel warns user community against quick fixes --- Iain FergusonIntel has warned the user community against depending on "quick fix" millennium compliance software tools to solve their date conversion problems.

Intel Australia's general manager, David Bolt, said there was confusion within the user community, generated to a large extent by companies "setting themselves up as opportunists" and providing millennium conversion tools with limited use in complex enterprise environments.

"Anybody should be very wary of people with a magic cure -- it doesn't exist," he said. "People are being fooled into thinking things are correct when they're not".

Bolt declined to be more specific about the issue, but revealed litigation over millennium conversion issues was a serious concern for the vendor. Bolt also said the company had received a number of approaches from companies interested in distributing Intel products following the suspension of distributor Electronic Resources Australia amidst allegations of product tampering and chip re-marking.

He said Intel had made "no commitments to anybody" over the possible removal of the suspension, which reportedly ERA board members are pushing for within a few months.

Handhelds, mobile phones meet halfway -

-- Ephraim Schwartz

Corporate road warriors are about to witness an explosion of information appliances that meld the features of mobile phones and handheld computers. But whether these hybrids meet end-users' needs, or those of the technology managers responsible for their care, remains to be seen.

Among the forthcoming developments, Hewlett-Packard is set to launch an HP Information Appliance product line with a communications device for mobile users, according to a source familiar with the project. The device is about the size of a 3Com PalmPilot, offers a simple solution for sending and receiving e-mail, and is not related to the company's Windows CE handhelds, according to the source.

Also, Puma, Motorola, Nokia, Ericsson, and others plan to announce products and alliances during the next several months that are aimed at selling corporate users on the concept of combined mobile phone/handheld computers.

And Microsoft, although not committing to specifics, is "investigating the different technologies for the mobile-phone space and working with a lot of people", said one product manager for the Windows CE product group.

The key feature topping users' wish lists -- and missing from the current generation of mobile devices -- is easy access to corporate data, such as phone lists. For instance, mobile phones, pagers, and digital assistants all have data banks, but they cannot talk to each other, one observer said.

Developments such as these are expected to fuel the market for convergence devices. According to International Data Corp., the annual worldwide sales rate will reach 5.9 million units for smart phones and 13 million units for handhelds by the year 2001. At that time, mobile phone sales will also cross the 200-million mark.

Australia trails in integration of Lotus Notes and Domino with ERP --- Laura MasonAustralian companies are exhibiting a low uptake of integration of Lotus Notes and Domino into ERP applications.

Lotus currently has around 40 clients integrating ERP with Lotus Notes and Domino worldwide, with just one Australian customer so far -- API Packaging -- taking the plunge and implementing the integration. Several other Australian companies are piloting the solution.

According to Peter Taylor, managing director of Lotus Australia and NewZealand, Australian companies are missing out on "a logical marriage between two strategic enterprise systems".

"The installation of an ERP system is not cheap," he said. "The typical cost is around $2000 to $3000 per seat, plus two to three times more for consultancy and implementation costs. What's more, use of the system is often limited to a handful of skilled staff.

"By adding a Lotus Notes and Domino interface for roughly $100 per seat the power of an ERP system can be extended to more users, native ERP data can be Web-enabled, and powerful workflow and collaboration applications can be built."

Integration of Notes and Domino with ERP systems can offer the following functionalities:

The ability to build employee self-service applications such as expense claims, invoice approval, purchase requisition and order approval.

The creation of a user-friendly GUI, consolidating specific information from the ERP system.

Mobile and remote users can enter data for the ERP system into Notes forms from the field.

Provision of a consistent interface for users while back-end systems are being overhauled.

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