There are busy times ahead for the IT industry, if it is to prove the benefit of IT to businesses, according to Neil Holloway, managing director of Microsoft UK.
"There is a crisis of confidence. Businesses spent a lot of money on Y2K and the dotcom revolution. They are now asking questions about the value of IT."
According to Holloway, IT directors today spend as much as 70% of their budgets maintaining and managing existing IT systems. "Only 30% is devoted to new developments," he said. Yet it is these new developments that will allow IT directors to prove that technology can add business value. While ripping out legacy IT may not be viable, "IT directors need to reinvest in new systems to reduce complexity and take cost out of the business," Holloway said.
Complexity will be reduced as the IT industry moves to a position where users are given the option to have a more integrated platform that supports both new and existing systems, said Holloway. Clearly there will need to be an underlying software architecture to achieve this goal but a broader set of industry partnerships is equally important, such as the industry's collaboration on XML web services, he said.
But for the average user, web services are bogged down in a conflict between two competing architectures: Microsoft's .net and Java 2.0 Enterprise Edition. "It is important to connect these architectures together using XML web services," said Holloway.
Greater collaboration is also needed in security, where a single user name and password should provide authentication across multiple IT systems and websites, he said. "A user may log into his Windows PC then skip through many websites, and should not have to sign in again."
This will require a federated approach to security where a trust partnership is formed between organisations, so that if a user signs on through any of the organisations in the partnership they are authorised to access any other without a further sign-on.
"At Microsoft we embrace the federated security model," said Holloway. "As an industry we need to work together and with governments on the technology and policies needed for security," he said. But to achieve a completely federated approach to security, every organisation requiring authentication would need to participate in a trust relationship.
Business-savvy IT directors
Holloway said IT directors need to understand how IT will affect the business.
Companies are looking to reduce costs, generate shareholder value and make staff more productive. While the traditional IT director had an operational role, Holloway said modern IT directors need to adopt a business transformation role in their organisations.
"There is a new breed of IT director who is aligned with the business and can add value by connecting people and processes," he said. "For example, in the NHS there is awareness at a senior level of how to achieve electronic prescriptions and electronic patient records." NHS IT directors need to understand both how much time it would take to complete these projects and how the role of doctors will change.
Holloway has some sound advice for aspiring IT directors. "At Microsoft I look for people who have a broader range of skills and are able to work outside of IT, inside business departments," he said. In many businesses, the career path into senior management starts by gaining experience in other departments in order to understand the business thoroughly.
Holloway urged managing directors and chief executives to manage the career paths of their senior IT staff in a similar way.
Working with high-level technology, Holloway sees the benefit of immediate access to information wherever he is. Since his employer is Microsoft his desktop is a Tablet PC; he uses a smartphone and his car is equipped with a datacard providing Wi-Fi and cellular data access.
But there is a problem. "Many people would benefit from mobile technology but billing and security need to be seamless," he said. "Take away 2.5G, 3G and 802.11 [mobile standards]: I should not have to decide which protocol to use." He would prefer service providers to remove this unnecessary complexity and provide a single point of billing for mobile access, irrespective of the underlying mobile networks.
But he affirmed the success of mobile technology, which is already helping in some areas of work, such as in social services where social workers are using Pocket PC handheld computers to fill in electronic forms when they visit clients.
One axiom of the IT industry, known as Moore's Law, suggests that processing power doubles every 18 months. Holloway does not see this rate of progression diminishing. "The growth in disc capacity will not slow down, nor will the quality of our computer screens," he said. The computing platform will continue to evolve and the software industry will find increasingly more sophisticated uses for the new hardware," he said.
"I have never taught a computer to learn to recognise my speech. But at some point, the technology will offer speaker-independent speech recognition." More powerful computers would also provide the necessary processing power for improving the accuracy of handwriting recognition systems and spell checkers, he said.
Next generation IT
Users' experience of modern software has shown that as it gets more sophisticated, software becomes more buggy. "The industry is a long way off from being able to build bug-free software," Holloway said. But there have been moves to make patches easier to track and IT systems are becoming more manageable he said.
One of the difficulties the industry faces is tracking errors in software once it has been released. He urged any user who comes across an error in Office 11, which is due out in the summer, to use the Dr Watson agent software to send Microsoft a bug report. Bug reports are "incredibly useful" to the support team, he said. And it is not just Microsoft that benefits from bug reports - the same technique could also be applied to bespoke software supported internally, said Holloway.
Greater industry collaboration, robust security models and tackling costs and maintenance overheads incurred by the IT department are the immediate challenges confronting IT directors, he said.
For mobile services to fly, Holloway said service providers will have to tackle billing, by providing a single bill for all forms of mobile data access.
And he advised IT directors to gain operational experience in business units so they have a holistic view of the business.
- Holloway takes on a new role at Microsoft, as vice-president of sales, marketing and services for the EMEA region, in July
CV: Neil Holloway
- Appointed vice-president Microsoft EMEA in April 2000
- Appointed managing director of Microsoft UK in July 1998
Since joining Microsoft in 1990 he has held a number of strategic posts in the UK subsidiary including two years as deputy managing director and director of the Organisation Customer Unit
- Managing director of Migent UK
Business development manager, Ashton Tate
- Master of philosophy degree in operational research and control engineering from Cambridge University and a BSc hons in mathematics from Bath University.