Anne Fitzsimons is director of services with IBM Ireland.
Based on your conversations with Irish CIOs, what are their main priorities right now?
From my perspective, it’s still cost reduction and operational efficiency. The way we would think about it is ‘do more with less’.
That’s a phrase we hear a lot, but is that realistic or is it a case of a law of diminishing returns?
I think it is possible. Sometimes it requires investment to get there and a lot of the conversations we would have with clients is in the potential areas they need to invest, but the payback on those investments need to be very rapid in order to be able to do that. Doing more with less is possible; it depends on the client, on their business and how they’re set up today. But it’s a key area that every CEO and CIO in the country is looking at.
You’re saying payback needs to be faster. For a time, IT was associated with long, drawn-out projects and uncertain outcomes. Has that climate changed?
Absolutely. If we end up with something fuzzy or unfocused, our experience is we never get anywhere, and there’s dissatisfaction on both sides. When we’re in a discussion with a client on the consultative side, we’re very keen to understand what the endgame is, what the client is trying to get to and how soon do they want to get there. Then at least we’re starting from the same page and how we define success. Where there is investment, the focus is very much on making sure there’s a payback.
What are the main areas for investment?
In order of priority, cost reduction is there and will continue to be there, customer focus is clearly catching up on it in terms of revenue growth and gaining or holding market share. And then, it’s about how to get more insight and intelligence to drive that revenue and understand their current customer base.
Is there a new discipline being applied to IT projects now? What’s being done differently, compared to before?
I’d say the CFOs are more involved than they used to be, and there’s much more focus coming from the CEO. A few years back, in a growth environment, you could afford to take a couple of punts, but in the environment that we’re in you can’t. You are back to projects having clear success metrics and really being quite short-term in terms of return.
IT budgets are under pressure but where is the balance struck between spending on maintenance and spending on what makes the business perform better?
Sometimes when clients go to cut budgets, they tend to immediately try to cut it out of the innovation side. That would be a mistake and I think they’re starting to realise that now. A lot of the discussions we’re having now with clients is to give up some of the standard stuff to run because we know we can do it cheaper, and then that leaves them with that extra bit to focus on innovation that they mightn’t have had before … There’s a whole element of trying to make sure that the innovation piece doesn’t get slashed and burned.
Is that how the cloud is coming into the conversation with CIOs, because it removes parts of IT that are expensive to manage?
There’s certainly a cost element to cloud but I think it’s wider than that. It’s about what else you can get from the cloud: the standardisation, the automation. I’ve heard some vendors talk about the cloud being like virtualisation on steroids but I think that underestimates the power of cloud because it’s much more.
Sometimes there’s a view that the cloud is the answer to everything. My view and IBM’s view is that there are some workloads that will never go in the cloud and it’s really about working with the client to find some low-hanging fruit potentially which would get a rapid return on investment, and taking a more workload-orientated approach to it.
How do you mean?
There are certain things like low-volume, high-transaction stuff like CRM or development and test that immediately you would say the right thing is to try that out in the cloud. But there are certain things that would be more complex, involving more information management which would not necessarily be suited to it. So what we’re saying to our clients is to try something, do a bit of testing – we have a very good test and dev offering which has had very good takeup, for example – to get an idea of how cloud can help.
It has really high return on investment, it’s easy to deploy and manage and also the provisioning times are really quick. With a focus on innovation and growth, being able to turn something around from a test and development environment and getting it out to market quickly is a big plus from a lot of clients’ perspectives. I think cloud will make a difference but I think we need to be careful. It’s not a panacea for everything. I think test and dev is somewhere we’ll start to see real traction as opposed to just talking about cloud.
Let’s come on to some of the other trends: IBM was there at the birth of the original PC. What’s your opinion on tablets: are they just consumer devices or have they a place in business?
I think they’ve a real place in business and I believe we will get to where they will be the desktop of choice. Globally, there are some clients at the bleeding edge where the desktop is no more.
It’s been said that people are starting to bring these things to work and ask for their work applications on them. Does this signal a move away from the traditional model of IT telling you what systems you can use?
How quickly it will happen is another question but I think there is a fundamental shift. It will become like your company car: you choose what you want and IT provisions it in the background.
Let’s move on to another trend: is social media a fad or a meaningful trend in business?
It’s a big growth area. it will continue to grow. I think it’s very much on most CEOs and CIOs’ agendas. Some of them are of an age where it’s new to them and they want the CIO to come in and tell them how they can use this in their business. I’ve been involved in quite a number of C-level conversations about that. To be honest, if they’re not talking about it, they’re missing a trick and I think they know that.
There has been a perception in many organisations that IT is only a cost and not a business enabler. To what extent are you seeing the CIO role and IT in general becoming more strategic?
More and more over the last number of years, I’ve seen the CIO being very much part of the top table and part of the decision making. That’s partly for the reasons we just talked about which is the fact that a lot of business is going online now and a lot of the routes to market are online so if you don’t have the CIO at the top table, I think as a business you’re making a mistake.
As a service provider, it’s about us enabling that CIO to be a success and to be more than just talking about their budgets every month. Obviously, it’s about helping them reduce the costs but then enabling them to come up with the innovative ideas that are customer focused, that drive revenue, that give good customer insight. I think we are making good progress there.
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