High
maintenance costs will hamper innovation unless technologies change
DUBAI,
UAE, 10 March 2014
-- IT departments that continue to spend more than 50% of their
budget on maintaining existing systems could be compromising the
competitiveness of their companies and their ability to deliver good
customer service. According to John Abel, business director,
engineered systems at Oracle, companies that thrive today are those
that successfully innovate to harness the technologies that customers
use to buy products and services.
Addressing
a gathering of CIOs in Dubai today, Abel said: “The back office as
it exists today is simply not equipped to provide the horsepower to
manage the transactions and provide the information needed,” said
Abel. “Today IT shops on average use only 13% of their budget for
transformational projects, and 67% on maintenance and “keeping the
lights on. Given this budget split, one could say that the core
business of many IT departments today is maintenance rather than
supporting the new way of doing business.”
Transforming
the data centre is essential if it is to support the company’s
efforts to do business with customers in the way they choose. “The
gap between a customer’s buying decision and the actual point of
purchase has been reduced to a matter of minutes, rather than the
days or hours it took in the past to walk into a store, or a travel
agent or a ticket office,” said Abel. “As importantly, the
customer can express their opinion of the buying experience
immediately, online, and to thousands, sometimes millions of people.
Companies attempting to manage both these elements of their business
with their current IT architecture will find the cost of creating
extra capacity unmanageable.
“Today businesses need to give
customers multi-channel acces to their business, listen and respond
to them via mobile, online and social media and analyse data to allow
them to be proactive rather than reactive to market shifts. This will
require more power, more storage, more capacity, but without spending
more money” said Abel. “It can be done by investing in systems in
which hardware and software are engineered to keep maintenance and
testing to a minimum and maximize power, all at a substantially lower
cost. “Increasingly we are seeing software being driven deeper into
the silicon of hardware.
In
addition Oracle pre-integrates its software to work more efficiently
with the hardware on which it runs; the result is a system that is
pretested, preconfigured and tuned for maximum performance before it
reaches the customer. By removing this burden the cost of running an
engineered system is dramatically reduced, management is easier and
reliability is improved significantly.”
The
subsequent freeing up of budget previously earmarked for maintenance
opens up potential to transform their IT organization into one that
is fast to respond to changing customer demands, and has the ability
to adopt new technologies to support new business channels.
