CIOs go shopping Where the smart money is

GARTNER - ANALYST ANGLE

According to Gartner, which this week releases a report entitled "Growing IT`s Contribution: The 2006 CIO Agenda", CIOs will come under increased pressure in 2006 to become more externally focused.

Gartner says that more than ever before, executives expect IT to play a significant role in business growth and competitiveness. This shift will accelerate in 2006.

The firm predicts that global IT budgets will increase by an average of 2.7% this year, compared to 2.5% last year. But as growth is on the agenda, aggressive companies are increasing budgets by an average of 4.8%. "Executives are expecting CIOs to move beyond concerns about cost, security and quality," says Marcus Blosch, VP and research director at Gartner EXP.

Thus business process improvement - or making a company easier to do business with - is the top priority for CIOs for the second year. Growing customer relationships, improving competitiveness and increasing overall efficiency are runners-up. Blosch says security remains a given at 4.5% of budgets in 2006.

Brad Eliot, IT director for Alexander Forbes" rel=tag>Alexander Forbes, says his budget will be allocated to application development and the further evolution of the company`s infrastructure.

"We have to constantly enhance existing applications to cater for market changes, clients needs and legislation. A fair amount of capital is being spent on compliance." Eliot says the major infrastructure drivers are IP telephony, the firm`s converged network and virtualisation. "These have been on the cards for some time and are closely integrated."

ABSA - INTEGRATION, BUT BUSINESS AS USUAL

Leon du Rand, group executive: group business and technology services at Absa, says the bank has "numerous" areas of focus for 2006, most importantly surrounding its integration with Barclays.

"Here, IT will contribute to the targeted synergies and enable business units to achieve theirs," he says. "Absa plans to be the pre-eminent bank in Africa, requiring an applicable technology framework for all African operations. This will most likely form the base for all Absa`s emerging markets.

"Regulatory demands have increased considerably. The focus will remain on Basel 2, Anti-Money Laundering (AML), Sarbanes-Oxley (Sox), National Credit Bill and others." He further refers to a large number of projects including SAP (operational support, analytical finance, vehicle and asset finance); a new sales platform; migrating from NT to Windows XP; and an identity management project.

Absa further realises it needs to accelerate its SOA (service-oriented-architecture) development. Infrastructure replacement and expansion will remain ongoing, and operational efficiencies will get increased focus, including streamlining business processes, and re-engineering and improving processes, for example customer administration processing. Legacy applications may be replaced.

SITA - UNLOCKING MORE VALUE

Reviewing Sita`s bold IT plans a year ago, CIO Vusi Magagula says the agency is on track with everything". Having already implemented Oracle`s ERP Solution, 2006 will see the implementation of a CRM and performance management solution.

"This is ... part two of the ERP project, after HR, finance, supply-chain, project and time management, wrapping those up with a business intelligence tool.

Magagula says Sita is "pretty sure" that, after this, it will need to extend its BI capabilities. "We will at least thoroughly investigate our options ... and possibly begin acquiring."

Another key area for the agency is the improvement of ICT services within Sita (or IMST - Information Management Systems and Technology). "We have adopted the ISO framework and will push for the adoption of Itil and Cobit this year. We aim to align all three."

Governance is also a key consideration. "Sita has committed to improving its IMST governance. Since governance is about behaviour, we will implement a policy management solution.

Users will have to agree with an `acceptable use policy` before being able to use their computer or services enabled by their computers. "Should we pick up misbehaviour, there will be a non-repudiation process. The policy will have check-points at different levels," he says.

Although Sita beat the open source software (OSS) drum at the beginning of 2005, it seems this was too early. "We signed business agreements with suppliers including Microsoft, Adobe and Oracle, because of the need for business continuity. Currently the OSS tender is out there and once that has been concluded, we will move to an OSS environment where appropriate.

"Sita will be ready in June, but implementation will be phased," he says. Magagula also notes business continuity and disaster recovery, an area to be finalised before the end of April. The technology will be acquired in the coming financial year.

CONVERGENCE IS KEY

Angus Hay, CTO of Transtel and one of the individuals piecing together the SNO, says convergence is no longer hot air.

"The market will see increased deployments of IP-based telecoms services. Transnet is migrating to VOIP, and Transtel is doing the same."

Hay says one of the biggest changes in the coming year or two will be a real move to competitive telecoms offerings. "Until now, all choices have included some flavour of Telkom infrastructure. In the future this will change, and will affect the pricing, quality, available bandwidth and innovation used in services.

"When a market has competition, buyers can begin using network-based services that have a guaranteed level of service." Hay says Transnet is on a consolidation drive.

"Many others are going through this. For Transnet the focus will be on standardisation (leading to a less volatile environment) and the implementation technologies to assist with that, most notably Microsoft`s Active Directory.