More Converas Ahead due to Weak IT Management?
February 25, 2010
A happy quack to the reader who sent me a link to a story that I thought was off topic. The title of the write up is “Global CIO: There’s No Money Left.” Gee, I thought I heard that the economy was rebounding. My own experience is that the economy is doing lots of things, but rebounding is not one of them. The write up is an interview between an Information Week person and a fellow named Stu Laura, a CIO, whom Information Week has interviewed before. I poked around for “Stu Laura” on Cluuz.com but found little to illuminate his tie ups. I wonder if he is “real”, but why would a “real” news outfit resort to a fictional trope? Anyway, Information Week pegs him as a poobah’s maven, so let’s see what the angle is.
The first point that jumps out is that Mr. Laura’s budget has been “frozen for two years.” Okay, I buy that. No extra money for the IT crowd.
The second point is that vendors are boosting their licensing and other service fees. Okay, I buy that. This is the SAP model or the approach to tuition taken by some flashy universities in Boston.
The third point is that Mr. Laura is running out of options. He said:
Don’t think I haven’t tried [to consolidate applications]! It used to be that, excluding internal programming and people costs, hardware was 50% of our budget and software 50%. Now it’s 20% hardware and 80% software … and maintenance expenses on that software are 80% to 90% of that budget. In short, there’s nothing left.
Information Week suggests that Mr. Laura is not such a hot shot manager. Mr. Laura responds:
You still don’t understand. Imagine that you’re still paying rent on every house you ever lived in. Imagine your relatives are now living in those houses: How could you throw them out? That’s what we are faced with. Our divisions are still using that software, so we have to keep up our maintenance expenses — what might seem “tactical” to us is “strategic” to them. Sometimes there even may be a better software solution, but then it’s a Big Number to buy … and that division may not want to pay for it. They would rather keep what we have.
Okay, Information Week does not understand. I really buy that.
But the capstone point is this exchange which is a golden moment in “real” journalism about the challenges of finance, information technology, and technical options.
Information Week: So get a bigger budget!
Laura: You really do have your head up your rear, don’t you. This is NOT the year for bigger budgets. I have to show that we are “team players,” and team players suck it up. You see, the other line officers have this thing called “depreciation,” which means they can take a factory, assume a certain useful life, depreciate it, and then show an asset that has almost zero value. Then they can go build a new one. We do not depreciate our software, but maybe we should — then we could show that we’re paying 18% maintenance on something that has next to no value — and move on.
Manager giving guidance to his minions prior to the Charge of the Light Brigade. I wonder if this is the unit’s technology officer? Source: http://blog.kievukraine.info/uploaded_images/5893-766931.jpg
I think I understand that managers have to work with what is available. With less available, managers have to solve problems. That is, I believe, what managers are supposed to do—manage effectively which means finding workable solutions that keeps companies in business.
When I transpose this interview to enterprise search and content processing, I have some different questions:
- Are we sure the vendors are at fault? Is it possible that the management of information technology is a larger problem? Advising is one thing; doing is another. A bit like a university professor?
- With scarce resources, will organizations be able to avoid the “free” software that comes with certain types of vendor bundles? When “free” does not deliver, what happens? Maybe more Convera, Delphes, and Entopia-type situations. (I quite like the alphabetical line up of search systems that were.)
- Why not provide more detail about Mr. Laura? He is a frisky lad, but I am not sure how to judge his comments without context.
Mr. Anderson, of course, is the founder of the Yankee Group and a professor at MIT. But who is Mr. Laura? Anyone know? Mr. Anderson’s secret source, alter ego, Dickensian character? Help!
Stephen E Arnold, February 25, 2010
The tin cup is empty. No one paid me to point out that Information Week assumes I know a lot more about its poobahs than I do. I believe that when assumptions are made I must report that I wrote this piece and looked up a picture for free to the War College.
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Not sure whether you’ve looked this up, but according to an earlier article by Mr. Anderson is a “composite of a bunch of CIOs” he knows.
http://www.informationweek.com/story/showArticle.jhtml?articleID=218501348
I’m not sure that this is a truly useful way to present the information – it certainly lends the responses more of an authoritative aura than they deserve.