Reports of Net's death greatly exaggerated

As IT budgets feel the pinch, organisations will look to maximise their IT spend by turning to Web-based solutions and collaboration, according to Dimension Data and Forrester.

"The period of comfort in the IT industry disappeared with the death of the dotcoms. In the current climate, for some companies it is an attractive option to marginalise IT," said Gerard Florian, general manager of Dimension Data's multiservice network group at the opening on Wednesday of DD's seminar, Accelerate 2001: Maximising the Impact of Your IT Spend.

"Organisations have put time and money in CRM, logistics and financials applications, but how well do they collaborate?" Florian asked the audience.

Fellow speakers at the event, Forrester's group director of research, John McCarthy and Dimension Data CIO Scott Petty agreed that stopping projects is not the best solution.

"The reports of the death of the Net economy are greatly exaggerated. Those not looking at the Net in a judicious way will find it harder to recover from the period of economic uncertainty we are in," McCarthy said.

McCarthy set out to debunk what he saw as the 10 myths of the Net economy, including the myth "companies can put Net projects on ice and remain competitive".

"This is actually not the case. Focus has shifted to the traditional business, not fly-by-night spending on technologies, but back to the traditional market. The price and efficiency gains of e-marketplaces and real supply chain integration have barely begun," McCarthy said.

According to Forrester, while 44 per cent of companies kept budgets flat in 2001 and 34 per cent decreased budgets, 50 per cent of all businesses surveyed had pruned or postponed projects.

However, spending on technology, although decreased, McCarthy said, was back to rational pre-bubble spending.

"It's a time of rationalisation and a time to get the internal house in order," he said. "The period of hype from 1999 to 2000 led to a period of despair. But the pendulum continues to swing and the momentum is to rationalisation and collaboration."

Forrester's McCarthy said the current period of rationalisation will see the Internet become an integrated channel that will be used to control costs, while spending will have more of an ROI focus. He said there is a shift in focus of IT and tech investments from transaction-based to a process-based spend as organisations look towards inter-company collaboration.

"Today's collaboration doesn't work because of one-sided bullying and near-sighted decision making," he said.

Instead, there is a movement towards dynamic collaboration, with a greater visibility, coordination and optimisation, McCarthy said.

Petty was upbeat on the concept of the portal with high useability to enable a collaborative approach.

"A portal can aggregate reporting information and display to make it easier for users to understand. Users can query the systems and navigate through portals easier. We used to spend 30 per cent of development costs on presentation layout, but with the portal we eradicated that spend on layout. We spent 15 per cent on portal itself."

The portal also freed up the IT team as its useability meant users did not have to query the IT guys.

However, some companies sacrifice useability for speed.

"Most sites flat out stink," McCarthy declared, when it comes to useability for Web sites, intranet sites and extranet sites with Forrester research indicating more than 50 per cent of B2B sites have fundamental useability flaws.

"Useability is seen as a nice thing to have that can be cut, but it's a necessity," McCarthy said. "There is a 50 per cent drop off with every click."

Petty said, "Useability is up to IT to take on and win when you look at the business value goal. Sometimes organisations focus on the speed and not on the useability of an application. A core goal of a project is around useability," Petty said.

"IT needs to stop thinking of internal and external sites as different. They're the same and need the same level of useability. You need to build a system that can deliver to all, with one architecture."

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