For today's technology leaders, IT not only matters -- it can also make or break a company's competitive advantage. Even with the tight economy, this year's Premier 100 IT leaders vehemently disagree with those who equate information systems with commodities such as electricity.
"We consciously keep an eye on the horizon and categorize the technologies as those in which we want to lead, those we want to keep pace with and those we want to follow," says Jean Delaney Nelson, vice president and CIO at Minnesota Life Insurance Co.
For instance, the St. Paul-based company chose to be a leader in computer/telephony integration, and "it's given us serious competitive advantage," she says. In fact, this year, Minnesota Life has moved up a notch to eighth place in terms of largest group sales in the U.S., and "the reason we're doing so well is our technology edge," according to Delaney Nelson.
It's not easy to keep track of the well-hyped and seemingly endless march of new technologies, and to that end, these IT leaders depend on advisory groups, steering committees and domain experts for reality checks.
"We give vendors 30 seconds to convince us how their technology will pay for itself," says Ben Harris, deputy secretary of operations and technology at the Florida Department of Children & Families in Tallahassee. "If I buy something, it has to help me cut costs in another area. That shrinks the field pretty quickly."
The job is particularly difficult in today's slashed-budget economy. "The opportunities for pursuing the different possibilities are definitely reduced," says Joe Drouin, vice president and CIO at TRW Automotive Inc.
For instance, a skunk works group at Livonia, Mich.-based TRW that experimented with new technologies has been disbanded. As a result, "we have to be really sure that we're not just chasing technology down a dead-end street," he says. "We put a lot more effort into ensuring that what's going to come out will have a clearly defined impact on the business."
Keeping one eye on the horizon and one on current business needs while also considering budgets, your infrastructure, what's hype and what's reality -- never mind the pressures from business people to pursue various technologies -- "it can be very multidimensional," says Lyn McDermid, senior vice president and CIO at Dominion Resources Inc. in Richmond, Va.
Certainly, this is no time for entertaining what McDermid calls the latest "toy du jour." It's increasingly important for IT to take a lead role in knowing what's ahead "so you can say no as much as yes," she says. "It's understanding what's on the horizon so you can make a good business decision as to whether to go there at all."
With that in mind, here are the top four technologies Premier 100 IT leaders say they'll be watching closely in the coming year:
- Wireless.
When you're in an organization with a lot of mobility, wireless technology makes a lot of sense. But you can also hit a breaking point when "wireless for wireless' sake" is just not worth it.
That's the challenge McDermid faces at Dominion Resources Services, a business unit of the huge energy company. Dominion Resources began doing off-site meter reading three years ago and plans by the end of 2005 to read all of its meters remotely, using radio frequency identification technology, as well as cellular signals sent directly to its databases. The company has also installed mobile computers in all of its service trucks so it can send work orders and receive status updates via satellite. "It's all about speed, and that's what wireless does," she says.
The company is more cautiously exploring wireless LAN technology to allow more efficient information-sharing within its offices. "We're piloting it to see whether we really save money," McDermid says. It takes a similar approach to BlackBerry devices. "A lot of people do not need immediate access to e-mail and calendars," she adds.
The University of Notre Dame is investing in wireless to support its mobile faculty and students. It's using 802.11b access points in its buildings, as well as switch/antenna technology from Vivato Inc. for its green spaces.
For off-campus students, the school has partnered with Motorola Inc. and local Internet service providers to offer secure wireless access at broadband quality to the campus network.
"It's a competitive thing, but we also recognize that student and faculty expectations are higher than in previous generations," says Gordon D. Wishon, CIO, associate vice president and associate provost for IT at the Notre Dame, Ind.-based university. "We're hopeful that we can give them access to educational and research material from any location on the campus." - Web Services.
Sometimes, having a limited budget can be advantageous. For Harris, restricted funds required him to find an inexpensive way to integrate data from disparate mainframe systems at 15 sites throughout Florida for his and six other state agencies.
The agency is an early adopter of InterSystems Corp.'s Ensemble application development and integration suite, which uses Web technology to access multiple databases with a single query. The system is expected to be fully deployed in a year.
"In many ways, this initiative was driven out of crisis," Harris says. "We weren't going to get appropriation dollars to encode a data warehouse type of environment." Now, he says, "if I'm a social worker, and I'm going to someone's house to determine if a child has been abused, I can look at the Medicaid data to see if there's a pre-existing health condition. Or I can access criminal history data to know if it's a high-risk situation." In the past, Harris says, social workers had to wait to get this information.
So far, the Web services system is much less costly than a data warehouse approach. "We've probably spent $100,000 in salary dollars in coding and development," Harris says. The system has also become the main driver of the department's IT strategy, since it plans to convert all 150 of its applications to a Web services model.
Harris acknowledges that Ensemble, as a new technology, carries some risk. "There are no real standards," he says. "But even if we just use it for 12 months, it is worth every penny." - Business Intelligence.
Notre Dame also plans to hone its competitive edge through business intelligence. Wishon is working with SCT Corp. and Business Objects SA to build a data-warehouse-based business intelligence system that will supply the university with data to grow its academic and research programs.
"Our legacy administrative applications really present barriers to extracting useful, accurate data and compiling it in ways that are useful," Wishon says. This includes data on student demographics and performance, financial aid and the success of the university's academic programs and research.
Students and faculty would also get exposure to the latest business intelligence tools. "Using the latest business intelligence technologies to better manage competitive positioning is fairly new in higher education," Wishon says.
TRW Automotive also wants to improve its business intelligence capabilities. It wants to provide sales and marketing executives with customer information gleaned from its heterogeneous mix of back-end systems more quickly than the four days it currently takes.
With today's fierce competition and heightened customer demand, Drouin is being asked to produce customer information that cuts across these systems. "If someone wants to know total sales to a particular customer last month worldwide, it's a manual effort," he says.
TRW Automotive is exploring data warehouse technology or Web services for the back end, with business intelligence reporting tools on the front end. "I'm looking for something that will give us the biggest bang for the buck, even if we have to compromise," Drouin says.
But Drouin says he feels he's ahead of the game so far. "I don't know another CIO in a Tier 1 automotive company that has harmonized its back-end systems," he says. Plus, his group is the one that identified the need for this type of system. "Before I have a sales guy storming in and demanding this type of system, it was a great instance to proactively say, 'Here's a set of new tools to make this process more efficient for you,' " he says. - Grid Computing.
Grid computing has been used by scientists for many years, but commercial applications are still rare. In this computing model, a centralized server distributes a processing job to unused cycles on other machines and monitors and manages the completion of that job, thus achieving one big virtual computing resource.
When Delaney Nelson's group at Minnesota Life first caught wind of this concept, "we thought, 'That's very cool, theoretically,' but the immediate business application was not apparent," she says. But when vendors began introducing grid computing products in a business setting, the group began researching whether it had any CPU-intensive applications that would benefit. That's when Minnesota Life's financial management system jumped to the forefront. "It's very calculation-intense and eats a lot of CPU cycles," Delaney Nelson says.
The company has been running a successful pilot using Microsoft Corp. servers and off-the-shelf software and is planning a production implementation. At first, the application ran on dedicated servers, but it was then expanded to run on partially used servers.
"The grid allows us to use those unused cycles on other servers and not interrupt their primary use," Delaney Nelson says. "They tell the grid when they're available so we don't have to buy more servers, and we're able to process the application much faster."
Minnesota Life probably won't expand on this initial foray into grid computing in the near term. "It was just the right answer for that application," she says. And for many companies, it still poses numerous obstacles, particularly the need to manage multiple environments at once.
With widespread budget crunches, business pressures and a never-ending march of new technology to track, today's IT leaders could easily get overwhelmed. When asked how they keep up, the answer in most cases is by surrounding themselves with trusted people.
"Clearly, the CIO can't know everything, so we have to rely on good people -- not only our own staff but vendor partners, the technology community, as well as lessons learned from peers in business and higher education," Notre Dame's Wishon says.
"The key," he adds, "is putting together a team of people who are willing to devote the time, energy, discipline and rigor to maximize our chances of success."
Brandel is a freelance writer in Grand Rapids, Mich. Contact her at mary.brandel@comcast.net.