Several things come through. The first is that IT is not doing a great job of marketing itself internally. That is no great surprise. IT always has done a better job of talking to itself than to others.

The survey, which was limited to large North American firms, found that the executives often give primary credit for business application development and support to entities besides IT, including vendors and third-party developers. Only 58 percent credited IT with app development, though Dubie notes that the department almost always is deeply involved. Put more simply, IT plays second banana too often.

Other results in the survey suggest that the problem may be more than image. The mediocre grades given by the 600 executives queried quite possibly suggest that IT isn’t doing as good a job as it should. For instance, only 45 percent of respondents view IT as helping improve workforce productivity. This is as likely to be the result of bad performance as bad marketing.

There are three things to think about here. First and foremost, IT departments must strive to support their organizations as effectively as possible. Secondly, they must do a better job of letting the bosses know what they are doing and why. This isn’t easy, because technology is by definition hard to describe.

The third takeaway is good news: Like the kid who gets a poor report card, there is tremendous room for improvement.

Icon by Indolences and used under The GNU Free Documentation License.

Check out the post for the specifics on what Kemsley reports that Colony advises CIOs to schmooze about. In general, the idea is that CIOs should push the reality that information technology does not exist in a separate little world from what the rest of the organization. For instance, the first tip is to convince the CEO that it’s “business technology” and not “information technology.”

On one level, this is a small semantic distinction. Such things matter in the big picture, however. “Information technology” is a bit vague and academic. “Business technology” is far clearer and suggests the direct impact of what IT people do.

Conceptually, trying to convince upper management of the importance – even centrality – of IT is a no-brainer. It requires quite an effort, however. IT folks are IT folks because they are technically inclined. Hopefully, people who rise to the top of IT departments have the willingness and ability to deal with the big picture, both in terms of what they do and how they communicate with upper management.

IT departments will continue to struggle as long as what they do seems mysterious. It is the task of IT managers is to stop being parochial and to draw a very clear picture of what the deparement does and, even more importantly, show how it benefits the organization.

Problem: IT finds itself in a quandary: how will it find innovative ways to respond to this financial challenge without compromising its ability to effectively serve the organization?

Solution: An often overlooked—but highly effective—solution can be found by implementing an IT asset management tool that has both software inventory and software “metering,” or usage tracking technology. Such tools deliver savings on both a tactical and strategic level by ensuring that organizations are neither under- nor over-licensed.

Analyzing software usage can produce a windfall of ongoing savings. In fact, identifying and eliminating unused software is one of the most overlooked strategies for cutting costs. Organizations often purchase far more software than they actually use in efforts to obtain volume licensing discounts and avoid software license compliancy risk. If left unchecked, they may pay for not only superfluous software, but also for unnecessary support and upgrade fees—for years on end.

When a software metering tool identifies licenses that aren’t being used, there are several options: reallocate them to employees that truly need them, terminate maintenance on those licenses, or eliminate the licenses altogether upon renewal. All of this can result in considerable savings for the organization.

Software metering capabilities are usually coupled with IT inventory functionality that enables IT staff to perform automated inventories of all the software assets installed across the desktop environment. The most sophisticated tools also reconcile discovered applications with associated purchasing data, reducing the overhead and improving the accuracy associated with performing manual audits. This allows organizations to conduct periodic internal software compliance audits and take corrective action before a software license audit results in unexpected fines and settlement costs.

IT asset management tools can also enable organizations to maintain compliance with corporate security policies as well as external regulatory mandates, thereby avoiding potential costs associated with the consequences of security breaches. For example, software metering technology offers a measure of security to an enterprise due to its ability to identify the presence and use—and in some cases block the launch—of unauthorized applications such as file-sharing programs, harmful executables, or unmonitored communication channels such as instant messaging.

Results: The IT professional can demonstrate an immediate reduction in spending to the finance department by identifying unused or underutilized software and subsequently reallocating or terminating maintenance on those licenses. Additionally, analyzing software usage patterns can help purchasing agents make better-informed decisions about the software needs of the organization’s employees.

Finally, the IT manager can prove long-term strategic value by maintaining compliance with licensing agreements and prohibiting the use of applications that pose costly risks to security or productivity.

About Kris Barker: Barker is the CEO of Express Metrix, a Seattle-based IT asset management solutions company. Barker is a skilled programmer and business manager with more than 25 years of experience in key development and leadership positions. He co-founded Express Metrix in September 2000, and has led the company to become a leader in the IT asset management market. For more information on Kris Barker and Express Metrix, please visit the company’s Web site at http://www.expressmetrix.com.

The consultant went on to say that the economy will play a big role in the implementation of such plans. Going over the limit is in essence a tax, he said. His point was that politicians will be reluctant to raise taxes in a poor economic climate.

Thus, there are two layers of uncertainty: The economy and the election. Despite the fact that both candidates support cap and trade, the short-term direction of the economy, the makeup of the new Congress and other factors clearly will influence how cap and trade is implemented and point to an extended period uncertainty.

Cap and trade is just one example of this uncertainty. There will be many subjects, large and small, that will be impacted by an almost unprecedented collision of an economic crisis and presidential and congressional elections. This clearly heightens the need for the CEO and CFO to plan carefully and to work out contingency plans – something that cannot be done without a great deal of ongoing input from the CIO.

These recent incidents have provided a jarring reminder of how important it is for financial and corporate institutions to secure, monitor, log and record all possible forms of real-time applications. It is clear that banks need to take tighter control of their communications in order to protect themselves both legally and financially.

Nonetheless, many organisations have been reluctant to adopt anything other than the minimum level of required regulation. The problem lies in the fact that most companies just cannot yet see the value in it and for many smaller companies, the massive investment required and uncertainty around all this newly required red tape far outweighs the purported benefits.

However, there are a range of business benefits to be gained from sound communications practices in compliance, including streamlined business processes, quality improvements, business intelligence, risk mitigation, and lower costs of doing business. Forward-looking financial services organizations should be carefully considering these benefits as they look to advance their communications infrastructure.

How can management take the enterprise towards a secure, compliant communications framework? Here are a few best practices:

Migrate communications infrastructure onto the existing WAN: By transferring all voice traffic (which is currently routed over the PSTN) within organizations to the existing IP network, financial service organizations are able to significantly reduce telecommunications costs and realize the full ROI from unified communications.

Truly unified communications enable a host of other advantages such as streamlined information delivery by eliminating or at least minimizing human delays. Unified communications also allows for easier, more direct collaboration between co-workers, suppliers and clients, wherever at the office, or working remotely. Subsequently, business travel can be reduced and with an increasingly mobile workforce, businesses are rarely centralized in one location.

One top ten financial services firm realized they could dramatically reduce operating expense by routing all intra-company calls and whenever possible, long distance calls, over its own WAN. In addition, this move enabled the company to enforce a single point of policy control over all of its voice traffic facilitating compliance mandates simultaneously.

Create a single point of policy administration, management and control in the network: Using all-IP based communications and a next-generation session management solution, organizations are able to leverage a system by which policy-based control over multimedia services can be enforced through a single point of administration. This allows for much stricter enforcement and control over the quality-of-service experienced by users within an organization. Depending on job function, level of seniority and main applications used, the system would enable organizations to control and monitor access to certain services and ensure a level of quality that users have come to expect from their real-time communications. An investment bank would be able to control which employees have access to video and IM services and be able to prioritize optimum network access to real time applications used by a senior trader on the front line, as opposed to applications necessary to someone in a more junior back-office or administrative role.

Utilizing a pure IP-based system would also allow for thorough session auditing, whereby communications can be monitored, logged and recorded thus providing an audit trail and the ability to enforce policies. To an extent, the damage sustained in the aforementioned Société Générale’s incident was mitigated through similar monitoring tools which they already had in place.

Société Générale’s ability to retrieve thousands of pages of Instant Messaging conversations exposed the fact that Kerviel may not have been working alone. Without this trail from which to work, investigators might never have identified his accomplices and the task of unraveling and reversing his unsolicited trades would have been significantly more difficult.

Integrate critical real-time information into the existing management framework: To reduce operating expenses and ensure SLA compliance, find a session management solution that delivers out-of-the-box integration with popular FCAPS compliant management frameworks. This integration gives the enterprise operations team the complete visibility and span of control needed to manage real-time applications and services from the data center all the way to the branch offices.

By using the existing WAN, deploying a session management solution and integrating with the existing management framework, organizations will gain from consistent policy enforcement across all modes of communication including multi-modal sessions whereby a session might begin as an instant messaging conversation and escalate to a voice call. Finally, large organizations also stand to gain much in the way of automation and simplification delivered by streamlined business processes and the reduced operational costs and ease of management that come with all-IP communications.

–Rod Hodgman – Co-founder and VP of Marketing, Covergence

About Rod Hodgman: Hodgman was a member of the Covergence founding team and is responsible for positioning the company’s session management solutions for maximum value and growth. Rod brings over 25 years of related business experience in technology start-ups and large companies.

Prior to joining Covergence, Hodgman the VP Product Marketing, Enterprise Products at Macromedia where he was responsible for the definition and introduction of Flex, an XML-based programming environment for the creation of rich, multi-modal Internet applications based on the Flash platform. Prior to Macromedia, he was COO of WorldStreet Corporation, a developer of real-time collaborative solutions for institutional equity broker/dealers and their customers. Hodgman also held positions as VP of Marketing at Borland, VP of Marketing at Open Environment Corporation and various executive management positions at Digital Equipment Corporation.

CEOs, CFOs and CIOs have to be on the same page about which projects are vital and which can be put on the back burner. The impact of ROI calculations on whether a project goes forward or not certainly changes as the financial position of the company changes. The CIO must be part of this ongoing conversation.

Procedures must be in place to consider long-term projects and day-to-day needs in the shadow of slashed budgets, an acquisition or even bankruptcy. The interpretation of what a company must do to live up to its due diligence obligations is impacted by the economic landscape in which the company exists. The IT department has to do its job in this fluid environment, so the CIO must have a deep understanding of precisely what is going on.

It also is true that a lot of people are losing their jobs. Clearly, extraordinary security steps must be taken. Data must be guarded more closely than usual simply because the temptation to steal and sell it will be greater. Laid off technicians will be tempted to maliciously monkey with equipment and networks. The CIO must keep the business heads of the organization up to speed on efforts to deal with an angry and frightened workplace.

The bottom line is that we are not in a period that anywhere approximates business as usual. CIOs and their staffs must strengthen the lines of communications with the CFO and CEO. Doing so will increase the chances of the company’s survival.

–Carl Weinschenk

It provides businesses of all sizes with a new choice in terms of the architecture on which they build their business going forward. Sometimes referred to as ‘on demand’ or ‘cloud computing’, we have until recently seen mainly specific operational applications such as CRM (customer relationship management) delivered successfully in this way. The fact that applications providers are starting to deliver offerings in a diverse range of areas, including strategic areas like accounting and vertical sector solutions, suggests that the market is developing and SaaS has become a real option.

Unlike the Application Service Provider (ASP) days of the 1990s, SaaS applications today are typically delivered through specially designed software with a ‘multi-tenant’ architecture – where many customers are accommodated on the same instance of software, with their data segmented from other users of the service. An example of this that many people use daily is Hotmail, Gmail or Yahoo mail. This is a multi-tenant environment where all use the same software to process email, but each user’s emails remain private. They are feature rich and in many cases are directly comparable with their on-premise counterparts. This delivery model may not be right for all businesses and as with anything, a company should pick the right way to deploy its business applications, based on its business process requirements.

The real benefit of SaaS comes from the ease of set-up, the subscription-based pricing with no large capital outlay, and the ease of maintenance. The risk of selecting the wrong application is significantly reduced as you can often trial the application free of charge before you buy it. Rather than investing in hardware and infrastructure and paying an upfront licence fee and ongoing upgrade costs, with SaaS, hosting and software maintenance is all provided for the customer as part of the rental payment. Users receive the benefits of new editions automatically through their provider rather than having to install a new version every time one is released.

This approach will not suit everyone and ‘traditional’ or ‘on-premise’ software will probably be around forever. But more companies are seeing a benefit in being able to use applications rather than focusing on infrastructure. In this way, I think SaaS signifies the biggest impact on the way business software is deployed and used since the dawn of the Internet.

Nicholas Carr, in his book The Big Switch: Rewiring the World, from Edison to Google, compares the computing industry to that of electricity. Once delivered in-house by each company that needed it, it went to being mass-produced and delivered on a power grid which anyone could tap into, and revolutionized the way we live. In this way, he believes the days of companies building individual IT infrastructures are coming to an end. He writes: “Hooked up to the Internet’s global computing grid, massive information-processing plants have begun pumping data and software code into our homes and businesses. This time, it’s computing that’s turning into a utility.”

In my mind, 2008 marks a turning point in the SaaS space. We have seen a number of key enterprise-level vendors throwing their hats into the SaaS ring – including CODA ourselves, of course. If more strategic business applications are available to organizations as SaaS, then they will take a more strategic approach to it.

Like many technology innovations, the market is awaiting the emergence of standards, particularly in the area of platform. The emergence of standard SaaS platforms – coined ‘Platform as a Service’ - as Salesforce.com is trying to achieve with Force.com, would provide a common infrastructure for new entrants to build all kinds of business applications. Like everything, some will argue that a reliance on a single platform provider has its risks. However, in this way applications can be built that talk to each other easily.

It becomes feasible for users to adopt a business architecture from the bottom up with all the necessary applications up and running very quickly and cheaply – an excellent option for start-ups with little IT budget and no IT expertise in-house for example.

The problem that has existed with a lot of SaaS applications in the past is that they have been built from the ground-up by vendors with little or no experience in the on-demand market space. Often, this has meant that integration with other applications remains a problem and the lack of rich features inherent in on-premise applications, has hampered efforts to drive SaaS adoption more widely.

SaaS applications must be feature-rich and available cost effectively, or they will not attract a sufficient subscriber base. For adoption to be widespread, standards will be important and integration capabilities vital. SaaS will remain just one option for acquiring business applications, but when the platforms become trusted we could see an increasing proportion of the market move this way over the next few years.

–Jeremy Roche, CEO, CODA [www.coda.com].

Photo courtesy of David Vignoni and used under the GNU Free Documentation License

Catastrophes aside, being fast and nimble is one of the defining characteristics of small and medium sized businesses.  Finance executives need fast access to accurate information to perform optimally.  In any business however, finding the right version of last month’s financial statements can sometimes be difficult.  If it takes two weeks or more to access and validate an operating unit’s financials, that may have just lost the deal.  It is not only important to provide data protection, but quick and easy access to the right information.

In today’s increasingly wired business world, the best way to recover from data loss due to a natural disaster is to store backup data in a physically separate location.  There are companies that specialize in preserving documents on tapes and discs that are stored within other structures.  Although they too are susceptible to natural disasters, these companies have helped to save numerous businesses where the damage has only been internal.

Another option that has been gaining attention recently has been to store files remotely.  Once a service available only to large companies due to cost considerations, there are now several firms specializing in offering offsite data storage to small businesses.  Such systems offer their clients the opportunity to store, archive and even authenticate their data over a remote network for less than $100 a month so that important files can be accessible even if the office is not.

Outsourcing in this manner often makes the most sense.  Financial executives shouldn’t be afraid to focus on their business’ core competencies.  If there is no more room to grow IT staff in the budget, selective outsourcing can be a great way to achieve operational efficiency and real savings.  Vendor and product selection are crucial to the success of this strategy.  Try to avoid enterprise, all-in-one solutions, as these products often cause more problems than they solve, and in small businesses these solutions can artificially create institutional rigidity when flexibility is an asset.  Magic bullets don’t exist.

Real bullets, however, do.  You’d be amazed at what a single bullet can do when properly aimed and fired. “High concept,” single-service solutions often offer a much richer understanding of their chosen expertise.  This will result in flexibility of service offerings and features you didn’t know you needed.  Evaluate any vendor or product in the context of an overall plan.  Picking vendors that can meet your growth targets will result in a longer-term solution.  There is no greater sapper of time, energy or enthusiasm than revisiting the same problem over and over again.

Beyond the cataclysmic events that are covered literally 24 hours a day on the cable news networks, there are circumstances that can be equally damaging to a small business without ever making the front page of the local paper.  What if the gardener pulling out the weeds hits a main pipe for the sprinkler system and floods the basement of your building where your documents are stored? What if a disgruntled employee gets overly enthusiastic with the “delete” key before packing his or her bags? Implementing a data archiving strategy to prepare for once-in-a-lifetime natural disasters also prepares your company for these smaller-scale but equally damaging human errors to ensure that your business runs smoothly, no matter what comes your way.

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