IT WEEK • 12 JULY 2004
32 COMMENT Why IT
needs to beef up HR
CONTENTS
32 INTERVIEW Michael Gough, chief executive of the National
Computing Centre, offers his tips for better IT performance
32 COMMENT A new breed of hybrid
HR/IT professionals could make
life easier for IT departments and
improve the efficiency of firms,
argues Madeline Bennett
37 INTERVIEW Michael Gough, chief
executive of the National Computing Centre, explains how IT
managers could create more value
for companies in the UK
MANAGEMENTWEEK
WHERE TECHNOLOGY BECOMES BUSINESS REALITY
Editor: Madeline Bennett
Purchasing systems merge
ARIBA’S NEW RANGE
•
Ariba is set to offer better spendriba has completed its acquisition
ing-management tools and services
of sourcing and supply manageafter its acquisition of FreeMarkets.
ment specialist FreeMarkets, in a
FreeMarkets’ Enterprise Sourcing is
deal that could result in improved spendto be combined with Ariba Sourcing.
ing-management technology and services.
Ariba also plans to offer new temThe combined firm will offer a number
plates for best practices.
of products, including tools for spending
visibility, procurement and supplier man18 to 24 months. Ariba said it will take the
agement. Ariba has offered some supplierbest functionality from that product and
management functionality in the past, but
build it into the Ariba Sourcing tool. Stratethe acquisition should help it offer a much
gic sourcing is a new area of focus for Ariba,
more rounded product range that addresswhich previously provided strategic services content management, electronic cones on a customised basis. Now, combined
nections with suppliers, and collaboration,
with FreeMarkets’ services arm, Ariba plans
said Sundar Raghavan, Ariba’s vice-presito offer best-practice templates.
dent of solutions strategy.
The plans were welcomed by
FreeMarkets’ Enterprise Sourcsome customers.“If a firm is trying
ing application will be combined
to buy something, sometimes you
with Ariba Sourcing and will be
have commodity expertise and
available as a service pack in the
sometimes you don’t,” said James
next two to three months. It will
Polak, director of general purchasallow customers to continue opering at US manufacturer PPG Indating on the FreeMarkets platform
ustries.“So in certain categories, we
or migrate to Ariba, said Raghavan.
would go to a FreeMarkets or Ariba
FreeMarkets’ QuickSource will McCormick: for expertise, [and they would procontinue to be supported for at least customisation vide] anything from hand-holding
A
•
•
IT inertia may hurt UK
Miya Knights
any UK firms are shying away from
deploying new systems, according to
a recent survey of 300 companies by software giant Oracle. Experts said firms’ competitiveness may be suffering as a result,
and IT managers should therefore do more
to gain the support of senior managers to
innovate and make changes.
Oracle found 41 percent of firms with
mainframes had used the same model for
15 years or more. Twenty-seven percent
M
ARE IT SYSTEMS WORKING WELL?
Do firms audit IT
If yes, has this led to
effectiveness annually? infrastructure changes?
No 43% Yes 57%
Source: Oracle
itweek.co.uk
Yes 86%
No 6%
Don’t know 8%
had used the same model for five to 10
years, and 27 percent had the same model
for 10 to 15 years.
Resistance to change could be harming
the performance of some firms. However,
many companies would find it hard to calculate whether an upgrade could be justified because they do not measure the value
of their IT systems – the survey found 43
percent did not carry out an annual review
to determine how effectively their IT was
supporting their business.
Jamie Anderson, programme director
of the Centre for Management Development at the London Business School, said
firms could lose out unless they encourage
the use of innovative technology. “Incremental innovation marginally improves
products, services or processes,” he added.
Anderson argued that many companies could benefit by looking outside their
own industry to find examples of how
to a full-blown services event.” He added
that in areas where his firm lacked expertise or needed advice on complex technology it might use Ariba-FreeMarkets services.
The acquisition will also lead to tools
for better visibility into spending, said Raghavan. In the past, Ariba shipped its Analysis product for this purpose and offered
associated services. With the addition of
FreeMarkets, the firm will offer to cleanse
customers’ spending data and process it on
a yearly, quarterly, monthly or weekly basis.
Dave McCormick, Ariba’s president
and previously FreeMarket’s chief executive, said the firms had spent the past five
months developing a plan to integrate
their offerings.
“We will now move forward with an
even stronger focus and flexibility to deliver the expertise that leading firms across
the globe are seeking,” he said.
Tim Minahan of analyst firm Aberdeen
Group said the combined company would
be able to offer a wide range of tools for
processes from sourcing to payment, as
well as services for buying expertise, sourcing and supplier management.
www.ariba.com www.eweek.com
FIRMS IGNORE NEW TECHNOLOGY
survey of 300 firms has found
• Amany
are reluctant to invest in new
•
•
technology and IT innovation.
Forty-three percent do not annually
review the effectiveness of their IT.
IT managers may need to do more
to gain support for improvements.
other firms use innovative technology to
improve the way they work. He offered the
example of a cement manufacturer that
had deployed GPRS tracking technology
to shorten the time between order and
delivery, inspired by the use of a similar
system by ambulance services.
But IT managers may need to gain the
backing of the board to make changes,
warned Anderson. “You will meet with
political resistance because in some cases
you are doing away with physical processes for virtual ones,” Anderson added. “And
you must recognise that there will also be
process constraints and the need to change
the mindset of people.”
David Neal
© eWeek USA 2004
IT Week staff
Online tool
to rate staff
tech abilities
IT training organisation E-skills UK
last week launched its online Passport IT assessment tool, to help firms
assess employees’ technology skills,
improve training, and take pressure
off helpdesk and IT support teams.
HP, Ford, BT, IBM,T-Mobile,
Accenture and the Inland Revenue
helped E-skills to develop the tool. It
provides an IT User Skills Framework, which can be used to create a
record of each employee’s training
history and skills, and help the
employer to set improvement goals
and personal learning plans in accordance with business needs.
Martin Harvey, project manager
for Passport, said,“Employers know
that they must improve their [staff]
IT skills.” He added that Passport can
assess skills at three levels: to judge
understanding of basics such as password management; to assess the ability to use common office applications; and to show whether staff can,
for example, generate benefits from
IT by using the internet to search for
work-specific information.
Announcing Passport at a Department for Education and Skills event in
London last week, Larry Hirst, chairman of E-skills UK and general manager of IBM in the UK, said:“Passport
has been developed in response to
the growing importance placed on
excellent IT skills. [It will] allow us to
assess the skills we and our workforce have, gain guidance on appropriate training and qualifications, and
reap returns on training investments.”
Hirst added that without such
assessments,“We risk our employability as individuals, our profits as
companies, and international competitiveness as a country.”
www.e-skills.com
www.e-skillspassport.com
31
MANAGEMENTWEEK
IT WEEK • 12 JULY 2004
A personnel friend
The emergence of hybrid HR/IT professionals should reduce many of the problems
besetting hard-pressed IT managers and increase efficiency, says Madeline Bennett
here’s a new type of professional in the world of technology –
the hybrid HR/IT manager. According to analyst firm Meta Group,
many organisations are appointing
staff who straddle these two functions, because the management of
IT staff may require a specialised
approach that is not always best
served by HR generalists.
I’m sure the notion of a combined HR/IT role will be welcomed
by IT chiefs who have to deal with a
growing list of tasks of increasing
complexity and importance – data
management, regulatory compliance, security and so on.
Indeed a recent survey from the
Chartered Management Institute
and recruitment specialist Adecco
found that 55 percent of IT managers believe they are being overloaded with work; while a third
are putting in an extra 14 hours
outside of their contractual hours;
and the same proportion feel
exploited by their employers.
T
Surely these overworked individuals will see the benefits of having their very own employee
resources manager. The hybrid
expertise will help to recruit the
most suitable IT staff; ensure that
good people are retained; deal
with the less competent; and
assign staff to appropriate roles
across the organisation.
But the HR/IT manager could
have an uphill struggle when it
comes to nurturing a happy workforce. A separate study by research
consultancy Orc International
recently found that IT staff are less
happy than staff in other sectors
because of limited training opportunities and a lack of recognition
of their efforts.
The HR/IT manager will also
have to work hard to keep up with
all the latest technology developments, training courses and professional certifications, to ensure they
can understand the current skills
required by their organisation and
predict where future skills shortages are likely to occur.
But for firms that appoint an
experienced person to handle this
role, there could be big benefits,
especially in areas such as employee
monitoring and flexible working,
both of which require significant
input from HR and IT.
The monitoring of employees’
internet and email use is pretty
common in large organisations,
but it’s clear that good policies are
not always in place. There are too
many instances of companies losing unfair dismissal cases because
they have failed to properly inform
staff of monitoring practices.
Hopefully, a joint HR/IT manager
would be more likely to ensure
such policies are properly developed and implemented.
Flexible working can also touch
both IT and HR departments, particularly when it involves home
working. Companies allowing staff
to work outside of the office need
IT needs dynamic leadership
NCC chief Michael Gough believes well-motivated IT teams
under business-savvy leaders are the key to competitiveness
IT STRATEGY INTERVIEW BY MADELINE BENNETT
IT Week:As head of the National Computing Centre, a leading organisation for the
IT industry, how would you describe the
current technology landscape?
Michael Gough: Over the past 25 years, the
UK has seen a massive rise in the amount
of application and software development.
But during the tail end of the 1990s, this
trend was reversed as firms focused on the
Millennium Bug and the dot-com bubble
burst. Companies are now more risk-averse
when it comes to technology. The
truth is most IT project failures
are actually business failures. But
business leaders have not been
held culpable and IT is blamed.
So failing projects are not due to
inadequate IT management?
British IT managers and directors
are among the best in the world.
They manage teams, innovate,
manage suppliers and budgets.
32
Often they’re the first port of call for
change leadership as they’ve been in the
thick of change for years. But most chief
information officers are not profit-andloss accountable. They’re budget holders,
and are viewed as a cost to the business.
They’re kept out of business planning
when they should be in the thick of it.
What should IT managers do to improve
their standing in organisations?
IT managers should demonstrate
how they are using technology to
help the business. Many IT people are happy simply to be
regarded as good, worthy individuals who keep things ticking
over. There’s a certain comfort
zone there because no one else in
the organisation can do that.
However, chief executives want
Gough: IT must IT managers to show leadership
be business-led
quality and help deliver business
value, instead of just being accountable for
their budget spending.
Any tips for delivering business value?
There’s still a gap in terminology. IT articulates solutions in terms of features you’ll see,
while chief executives talk market share,
profit and loss, stakeholder value. Instead
of talking technology and features, IT managers should talk about business – and business is about making money. This approach
should be taken by public-sector IT chiefs as
well. The financial and management accounting principles in the private sector are
the same as for the public sector.
Should companies be looking to outsource more IT functions?
Outsourcing is a management theory that
hasn’t necessarily proved itself. The first level
of outsourcing is to a local supplier, but they
have to cut their costs and put the service
offshore. So a British-owned Indian organisation might outsource to China and there’s
suddenly three lots of service level agreements and all sorts of potential pitfalls.
But surely outsourcing can cut costs.
It is very rare for an outsourcer to provide
to have good procedures in place
to assess requests for home working, and to manage the technology
and set up computers and network
connections. They also need to
address issues such as health and
safety, and insurance.
Incorporating IT expertise into
the HR team will make it easier for
HR to take responsibility for home
working initiatives. Another benefit
of the combined role would be to
free other IT managers to focus on
business strategy and technology
development issues.
Surely the advantages should
prompt many more organisations to
consider introducing hybrid HR/IT
managers of their own. ITW
[email protected]
ABOUT MICHAEL GOUGH
Gough was appointed chief
• Michael
executive of the National Com-
•
•
puting Centre – an IT industry body
with 1,300 members – in 2000.
Previously, Gough was head of
technology strategy at Sema Group
UK, where he was responsible for
technical governance.
He was also on the Office of the
E-envoy’s Technical Advisory
Committee from 2001 to 2003.
the same level of service as an internal
team while at the same time being cheaper. Any outside organisation will do it differently and then your in-house capability
is reduced. If a company spends its money
on outsourcing, it is dependent on the
supplier – and vendors are not very good at
helping businesses grow.
How can this danger be avoided?
I’m saying that for the new IT agenda, we
should be focusing our attentions on the
real core skills of IT – the business applications. We should be bridging the gap
between technology and information held
in our systems and assessing how to use
that information as a competitive tool.
Developing your own competencies offers
more control and adaptability. ITW
itweek.co.uk