Don't underfund infrastructure

The collapse of the dotcom sector and concerns about the slowing European economy are forcing companies to take a hard look at...

The collapse of the dotcom sector and concerns about the slowing European economy are forcing companies to take a hard look at their e-business investments, putting increasing pressure on IT professionals to invest wisely.

Alex Drobik, vice-president of the business management group at analyst firm Gartner, said that although mounting fears about a global economic slowdown were unlikely to push companies to scale down their e-business investments, e-business leaders would be expected to invest wisely.

Over the past two years, UK plc has made some aggressive investments and a lot of IT process mechanisms have been sacrificed on the altar of speed. But in the current economic climate, cost is likely to be a more significant factor.

Company boards are beginning to ask some hard questions about their e-business investments, and it is likely that some companies will rationalise the number of e-business projects they are running, said Drobik.

Those projects founded on fundamental business strategy are likely to remain untouched but the "me-too" projects will fall by the wayside, he warned.

Spending will not reach the peaks of a year ago and IT departments may have to reuse existing hardware. But any change in spending patterns should not be allowed to affect crucial infrastructure requirements.

"Get the infrastructure in place to support what you need because, at some point in the future, the business is going to request it. If companies don't do that until later, they will be in big trouble," said Drobik.

Ed Smith, the UK board member responsible for e-business at PricewaterhouseCooper's, said that despite concerns about the decline of the dotcom sector and the slowing economy, shrewd companies will be investing more in order to move from a dislocated environment to one which is more driven by self-service.

"The smart companies will not be scaling down their investment - they will be investing more in e-business now than before and pushing to upgrade their infrastructure to allow e-business transformation to take place. In an economic downturn, smart companies will be looking to replace people with self-service technologies," Smith said.

Hazel Ward

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