Software development costs are tip of iceberg

New application costs consumed by integration.

Twenty-six per cent of the cost of implementing a new application is consumed by integration with existing applications, according to a survey of 105 IT executives in Australia commissioned by InterSystems. The figure remained virtually the same as that uncovered by last year's survey.

The InterSystems Australian Integration Survey found that 64 per cent of organisations are hampered by insufficient staff resources in being able to quickly and cost-effectively connect or extend their applications. Lack of available skill sets was reported by 45 per cent of respondents and insufficient budget by 42 per cent.

"No wonder organisations have insufficient staff resources to integrate new applications, when it consumes 26 per cent of the budget", said Denis Tebbutt, managing director of InterSystems in Australia. "That is a substantial overhead in developing new applications and a significant drag on business agility".

Tebbutt said that increasing staff resources was not the answer to the challenges organisations face in integrating applications, pointing to forecasts by IDC that the deficit of skilled high-tech professionals in Australia is expected to increase to 7100 by 2009.

"If organisations expect more staff resources to come to their rescue in the midst of a growing IT skills shortage, many will be disappointed". said Tebbutt. "Realistically, these barriers will only be overcome with new, less labour-intensive and less costly technologies for connecting and extending applications".

The survey found that the most common of these new technologies -- Web services/SOAs, deployed by 52 per cent of organisations surveyed -- has still not replaced traditional, more labour-intensive ways of connecting and extending applications. Some 39 per cent of organisations were customising applications, 36 per cent re-engineering applications and 35 per cent replacing them.

Len Rust is publisher of The Rust Report.

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