TECHNOLOGY BUDGETS RISE TO TOP OF KEY IT ISSUES

FAYETTEVILLE, Ark. - Not unlike other areas of business, information technology (IT) departments in the country’s major corporations are being asked to "do more with less." In addition, IT budgets are not keeping pace with organizational growth as a percentage of revenue, according to the board of advisors for the Information Technology Research Center (ITRC) in the Sam M. Walton College of Business, University of Arkansas.

For the third year in a row, the ITRC board members have ranked their top-10 issues (see Sidebar - Summary) currently facing their IT organizations.

"Budgets have become the top IT issue because the departments are being asked to hold or reduce their budgets, yet provide more services to the organization," said Bill Hardgrave, executive director of the ITRC and Edwin and Karlee Bradberry Chair. "Maintaining an ever-increasing base of applications has exacerbated the problem because IT departments are spending more on maintenance with little left over for new software development. Measuring the return on investment also presents a challenge because IT services can provide strategically relevant, but largely intangible benefits."

The ITRC is an interdisciplinary research unit of the Walton College. Its board of advisors is comprised of 15 technology executives from international, national and regional businesses as well as state government. The board provides long-term strategic direction, industry feedback on IT research and education and, in some instances, funding for IT research. Rather than focusing on technologies, which change rapidly, the board survey reflects more salient and broader IT issues. The top-10 issues provide a barometer of activities in these organizations and serve as a signpost for the academic community for research and curriculum issues.

According to Hardgrave, security and privacy ran a close second with the ITRC board. He said, "The increasing importance of security is no surprise. As the range of security risks continues to increase, companies are expanding their security management, especially in the areas of risk assessment, access controls, and disaster recovery planning. " The rapid growth of wireless networks has also created security challenges. New policies, procedures and tools are needed to protect systems as the world becomes more connected. In addition, companies must consider privacy regulations in protecting the information rights of individuals.

The ITRC board’s other top concerns include training and development of IT workers. Rather than hiring new IT workers, employers are focusing on training their existing IT workforce to stay abreast of the latest technologies and development processes - while trying to maintain a high level of productivity. In addition to technology issues, security, privacy and governmental regulations must be incorporated into the IT culture.

"A new issue this year is facilitating teamwork and collaboration," said Hardgrave. "IT workers have always worked in teams. However, today’s software development environment is one of geographically dispersed workers, trying to collaborate from different time zones. Teamwork is essential for rapid development, but what team model works best? What are the best technologies to support collaboration? It is a very complex undertaking."

Other top-10 issues include business continuity and disaster recovery, inter-organizational collaboration and global standards, project management, governmental regulations, business process design, and systems integration.

Hardgrave added, "Another new issue that has surfaced is inter-organizational collaboration. Integrated supply chains; collaborative planning, forecasting and replenishment (CPFR); and the global economy have forced suppliers and customers to work together. There is a great need for widely accepted industry standards."

ITRC board members include: Wally Anderson, Acxiom Corporation; John Haley, ALLTEL Corporation; Joseph Smith, Arkansas Blue Cross Blue Shield; Mike McGibbony, Arkansas Department of Information Systems; Carolyn Walton, Arkansas’ Executive CIO Office; Phil Porter, Arvest Bank Group; Steve Ratterree, Beverly Enterprises; Marty Schoenthaler, ConocoPhillips; Don Hall, Data-Tronics Corp.; Charlie McMurtry, Dell; Bill Holder, Dillard’s Inc.; Kay Palmer, J.B. Hunt Transport Services Inc.; Dee Hency, Southwestern Energy; Jeri Dunn, Tyson Foods Inc.; and Dan Phillips, Wal-Mart Stores Inc. In addition, members from the Walton College include Doyle Z. Williams, dean; Fred Davis, David D. Glass Chair in Information Systems and chair of the Information Systems department; and Anne O’Leary-Kelly, professor of management.

The ITRC was established in the Walton College in 1999 with a portion of the endowment created by the Walton Family Charitable Support Foundation gift of $50 million in 1998. The ITRC's goal is to actively engage the business community in such activities as research projects, roundtables, workshops, conferences, and a variety of student-oriented events.

For more information on the ITRC and the 2003 top-10 IT issues, check the web at http://itrc.uark.edu or contact (479) 575-4261.

(Sidebar - Summary)

Top-10 Issues Facing IT Organizations in 2003

(According to ITRC member organizations)

1. Budget versus service delivery (2002 Rank: #2, 2001 Rank: #7)

2. Security and privacy (2002 Rank: #4, 2001 Rank: #6)

3. Training and development of information technology workers (2002 Rank: #1, 2001 Rank: #3)

4. Facilitating teamwork and collaboration (2001 Rank: not ranked, 2002 Rank: not ranked)

5. Business continuity and disaster recovery (2001 Rank: not ranked, 2002 Rank: not ranked)

6. Inter-organizational collaboration and global standards (2001 Rank: not ranked, 2002 Rank: not ranked)

7. Project management (2002 Rank: #7, 2001 Rank: #4)

8. Governmental regulations and compliance (2001 Rank: not ranked, 2002 Rank: not ranked)

9. Business process design (2002 Rank: #6, 2001 Rank: #10)

10. Systems integration (2002 Rank: #8, 2001 Rank: #2)

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