Voice of Our Readers: The 2006 Strategic Management Survey - InformationWeek

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12/14/2005
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Voice of Our Readers: The 2006 Strategic Management Survey

What's top of mind with Intelligent Enterprise readers? The more than 1,100 who responded to our Web Poll say inadequate security, misplaced vendor priorities, disparate systems and poor IT planning are big problems. Here's what your peers are doing to refocus spending and deliver better, more timely insight.

Executive Summary

Our 2006 Intelligent Enterprise Strategic Management Survey revealed that security, privacy and identity management will be top spending priorities in 2006. Readers are putting major efforts into improving information delivery speeds to address fraud and security challenges. A major motivation is regulatory compliance; organizations must sort out audit trails, enable IT systems to identify exposures and give managers the information to remedy them. Readers are being more cautious in deploying strategic business applications while they attend to regulatory compliance.

Improving information access will also be a high priority. More that half of survey respondents noted that poorly informed decision making remains a problem for their organizations, and readers said portals as well as performance management scorecard and dashboards are a budget priority for 2006. These results demonstrate the changing face of BI toward more operational needs. The survey also identified content and document management as a top concern as readers ramp up efforts to gain intelligence from unstructured sources.

The 1,131 who responded to the survey included both business and IT readers. Corporate and line-of-business executives accounted for 23 percent of the respondents. The majority of respondents were CIOs and other IT executives, information and application managers, and IT service providers. The survey drew respondents from organizations of all sizes, across a range of industries and IT spending budgets.

We're not there yet. That's the upshot, for both user organizations and vendors, of our 2006 Strategic Management Survey. In this poll, readers tell us that information technology, while enabling critical business insight and smarter processes, also produces silos that can hobble companies trying to integrate information for a cross-functional, enterprise understanding of business performance, customer behavior and other key factors. The brave new world of service-oriented architecture (SOA) gets a qualified endorsement; security, software licensing and performance hold back faster adoption. And there's more.

Last September, we asked our readers to help us shine the spotlight on them—to find out what they thought about important trends in IT development, implementation and deployment. Like kids in a candy store, we took full advantage of the opportunity. We thank the 1,131 readers who provided answers that reveal much about the current effectiveness of strategically important business applications involving business intelligence (BI), content management, SOA, business process management (BPM), information integration and other related tools and platforms.

To kick off the New Year, we examine what the responses tell us about where things stand on the journey toward the realization of a more intelligent enterprise. In this article, I'll highlight the survey's insights into our readers' strategic IT management challenges. Editor Doug Henschen follows with a feature exploring what respondents' top 2006 technology spending and interest choices tell us about information access, analysis and other issues.

Business and IT: Get in Sync

Strategic business applications succeed when they advance business goals rather than let technology or human inertia impede them. Thus, Intelligent Enterprise readers are sensitive to obstacles in both management and IT that stand in the way of producing competitive advantage.

It turns out that a big obstacle is IT credibility. Roughly 47 percent agreed with the statement that "Some strategic business application projects have been halted or plans not approved because of an inability to quantify productivity and revenue benefits." BI projects in particular face a credibility problem. About 36 percent answered that BI technology "is incapable of performing all the functions we need."

The BI stack, which begins with user interfaces and extends down into analytics, data warehouses, integration middleware, databases, servers and storage, is still struggling to deliver on its promises. As the Listening Post at the bottom right shows, readers across the spectrum of IT spending (and about half the total of who responded) agree that workers in their organizations "frequently make poor decisions" due to a lack of useful information.

So, should organizations turn away from further BI investments? Hardly; what's needed is a clear vision of how information and supporting technologies work together to apply the right knowledge to the right problem. "The challenges facing us include effective data integration, implementations that span multiple hardware and software platforms, use of multiple BI tools and differences in architectures," says Steven Dempsey, senior technical specialist at Washington Mutual and a survey respondent. "We're dealing with these issues by establishing and adhering to standards, sharing best practices and providing superb infrastructure support."

One function in need of good information and analytics is IT itself—a topic we've been covering in recent issues. Organizations are increasingly implementing BI and performance management tools, often packaged inside other solutions, to improve accountability and align technology development and deployment more closely with business goals.

In his December column, "A Model for IT Governance," contributing editor Mark Smith noted that "CFOs now appear to be more involved in IT investments, and they're demanding results." CFOs have multiple priorities on their IT agendas, such as streamlining the financial closing process: but CFO leadership is growing largely because of the urgency to comply with regulations such as the Sarbanes-Oxley Act. While by no means shutting down new strategic business application deployment, our survey showed that the majority of organizations (65 percent) are exercising more caution in the face of confusing and unforgiving regulations. This urgency, plus CFO leadership generally, is pushing interest in running IT "like a business," with measures, metrics and reporting to back up this goal.

In 2006, expect to see more BI-like tools from the likes of BMC Software, Computer Associates, Compuware, Mercury, PlanView, Troux Technologies and others focused on IT governance and business systems (or applications) management. About 30 percent of respondents told us that improving the timeliness of information for IT performance management is a "big effort"—if not the "highest priority"—at their organizations. Only one quarter said that they have appropriate tools and measures in place right now.

Competency Centers: Integration as Strategy

Old technology rarely dies or even fades away. In most organizations, production systems keep on ticking and must be integrated with other systems. Integration woes bedevil everyone, leading many to ask as they try to deploy new systems: Is there a better way? How can we avoid repeating the same mistakes?

IT governance is gaining steam for the development of best practices—or adoption of industry standards such as the IT Infrastructure Library (ITIL). Organizations can't afford to waste time and resources in deploying systems; capitalizing on market opportunities depends on keeping IT efforts on track with business objectives. Gartner, the IT research and analysis giant, introduced the notion of "competency centers," which gather key internal business and IT people to develop best practices, improve the process of technology adoption and create support for cross-functional, enterprise initiatives—that is, ones that must cross the silos and fiefdoms, and, therefore, address people and process problems as much as technology challenges.

We asked readers if they're establishing competency centers (sometimes called "centers of excellence"). In several categories, the answer was a strong "yes." Integration competency centers are particularly popular for the tough, political job of setting common policies and methods of sharing data and integrating applications. Almost 46 percent have established one, while about 25 percent plan to do so. The Listening Post on the next page offers a breakout according to IT budget.

The survey revealed just about the same determination to create competency centers for data warehousing and customer intelligence as for governance and regulatory compliance, both areas that demand strong business/IT alignment. "Search, taxonomies and analysis" drew a 20 percent tally for established competency centers, while about 22 percent were planning to establish one. In 2006, search technology will garner attention, especially as IBM, Intel, Microsoft and SAP field solutions to compete in both consumer and enterprise markets. Competency centers will help organizations get beyond the inevitable hype and apply search as an entry into semantic integration, an emerging technology field that promises to help users draw knowledge from unstructured, incomplete and imperfect information.

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