Imagine you’re sick and tired of cereal for breakfast so you go out and buy a shiny new toaster. After three glorious months of hot buttered toast, you notice an identical toaster across the kitchen. Your husband or wife didn’t think to look in the cupboard where you’ve been storing it and went out and got their own.
Or suppose you arrange finance and contracts to buy a new car. It won’t be built for another two years, but the contracts say you have to pay registration and maintenance costs up until you take delivery and start driving it.
Sound ridiculous?
According to Dr Michael Zastrocky, vice president/research director, Gartner USA, that’s exactly what’s happening in IT departments across the world.
“There was a situation at a university where a particular department had bought a piece of software,” Zastrocky explains, “and in another department they’d done the same thing. They could have got together, realised they both had a problem that needed solving, and bought one copy with two user licences, which would have cost a little over half what the university ended up paying. In fact, they’d probably have discovered that ten departments needed the same thing and saved even more money and time in training.”
In a lively presentation to Perth’s IT community last week on planning for IT change in turbulent times, Dr Zastrocky gave his views on IT planning in a turbulent economy.
And coming from a higher education background, he urges particular caution on universities and other large institutional education providers where a decentralised bureaucracy can waste money and resources. “The average turnaround time for these sorts of projects in business is seven months,” he says, “in education, it can be three years, five years, seven years'”
Dr Zastrocky wants the end of ‘IT lassez-faire’. He believes our businesses and institutions need strong IT leadership so technology can do what it was supposed to from the beginning — provide solutions, not fill the world with fast-profit but ultimately useless or doomed technologies.
Because according to MIT, technology has been of absolutely no use to human economic productivity. Since the computer chip revolution of the 1970’s, global spending on IT has tripled but (by the benchmarks used in MIT’s study) productivity has actually decreased. To Zastrocky, the conclusion is obvious. “So all this technology expenditure hasn’t really made the way large institutions do business any better.”
If centralisation of planning all sounds a little Orwellian — all decision being made on high — that’s not what the philosophy is about. You need to get your people together to talk about what they need collectively, then use that volume to maximise your purchasing value. “The best organisations do it no matter how big or small, even if it’s for half an hour a week,” Zastrocky says, “if everyone’s together, you get the chance to synch your IT plan with your goals instead of every department doing what they want and spending money that might already have been spent.”
When you’re dealing with low or shrinking budgets and you have to measure IT as a value for your organisation, Zastrocky’s system of centralised leadership, policy and planning might be just what you need.
For example, where will you be when the unthinkable happens — when your global brand name vendor evaporates (like a company the size of Enron was never supposed to) or the unthinkable happens, like terrorists crashing planes into buildings (The City of New York had an iron-clad terrorism response plan — against chemical and biological agents).
It also means more than just centralising your emergency response plans, however — the vast majority of security breaches are still caused by people not protecting passwords. And make sure you pick a vendor based on their goals and mission, not just their attractive quote, and still ask yourself what you’d do if they disappeared?
Nobody can deny that times are bad for IT — to Zastrocky, that’s good. “We never pick over the bones of a project trying to see what happened after it succeeds,” he says, “only when it fails.”
And with budgets diminishing not just because of the economy but IT’s low credibility in general, it forces organisations to be smarter with the money they’re given instead of lavishing money on orgies of dotcom-era style spending.
Those who follow Zastrocky’s model of centralising control and leadership might well cause a few disgruntled freewheeling IT buyers, but he thinks it’ll save time and money in the long run.