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By Peter Coffee  |  Posted 2003-08-18 Print this article Print

Coffee: Are there any substantial shifts toward open source as a cost-reduction measure?

Benincasa: Were looking to evaluate open source as an alternative in 2004. We dont have the answers yet, but its something were definitely looking into.

Coffee: What about networks and network management?

Benincasa: On the network side, were looking to spend some money to be able to better manage the workstations, deployment, patch management. Weve got to find a better way, so were hoping to make some investments there.

Coffee: Several of you have mentioned handhelds, Tablet PCs and other nondesktop, nonworkstation form factors. Are handhelds becoming enterprise devices rather than just e-mail clients and personal organizers?

Baradet: [For our students,] its more a convenience issue. They dont want to drag their notebooks around when they dont need to use them, so theyre really more interested in wireless e-mail and calendaring. So, from that point of view, [mobile devices] fit in with what were going to do. Were about to put up a test [Microsoft Corp.] Exchange 2003 server, and well start fussing around with that to see how well its going to work for [the students and faculty]. But were not actively developing any specific applications for wireless handheld devices.

Coffee: Anything to add in terms of workstations and notebooks?

Wilson: Were seeing a big move—not only in our company but in others that were in contact with—to leasing laptops for three years instead of two. [This is due to] a combination of factors: the budget, the economy and a new generation of laptops.

Coffee: Are there any concerns about the continued viability of some of your key IT providers? If so, what is your thinking on continuity across the various mergers and shake-ups that are taking place there?

Brown: We are concerned about acquisitions and mergers. We had a departure plan, or an escape plan, for one of our systems, and that plan was purchased by the company and was killed. Thats why were looking at interoperability and standards.

Baradet: Our main focus has been building bridges between the systems that we run and the central data marts that we pull from to do our own reporting and augment the data that we collect locally. So its more that we need to keep an eye on this sort of thing. If you were to talk to the central IT folks, they would probably be a lot more worried.

Gunnerson: We have a concern over the continued exiting of Web co-location and hosting services. I have the same concern for, obviously, carriers because they keep going in and out of Chapter 11. We understand that thats not necessarily a bad thing, but it certainly feels like it increases our risk.

Coffee: Are you making more of an effort to maintain relationships with multiple sources than you might have in the past?

Gunnerson: Were moving right now to bring Web hosting back into the company.

Smith: About a year and a half ago, I set us on a course to kind of hedge that side of the industry, which has been quite volatile during the last couple of years. We have actually bought outright all of our servers, as opposed to leasing. Weve bought all our Oracle licenses for the back-end databases. So we actually are in a position where ... were a little bit more nimble in how we move.

Coffee: With overall IT budgets flat, will companies squeeze the balloon in one place to make more money available for security?

Gunnerson: I would say, in general, no. For several years now, security has been a part of almost every project we do. So the general cost of security doesnt seem to be going up.

Coffee: Has anyone been seeing costs associated with regulatory compliance in areas such as the Health Insurance Portability and Accountability Act or the USA Patriot Act or the new California Security Breach Information Act?

Rabuck: HIPAA has probably the biggest effect. In fact, sometimes the common reply is to ignore the technology if [the feeling is] its secure enough, rather than look for the security wrapper to make it secure.

Coffee: So legislative mandates for security are retarding the adoption of new technology?

Rabuck: I think thats the reaction if people are unsure or if there is stuff in the popular press that says, "Hey, this is not secure" or something.

Coffee: Many of you have mentioned the spam problem. Is the cost in wasted user time, wasted storage space or the various technical means youre evaluating to contain unsolicited e-mail?

Benincasa: Weve seen costs on the spamming and so forth and peoples time and in bandwidth consumption as the mail is coming in. In addition, the scanning tools require a lot of maintenance, and people have to keep an eye on them, maintain them and keep them updated. We have not had good luck with that. So the combination just takes a toll on the financials of an organization and on peoples time.

Coffee: So a lot of the cost that youre talking about is not IT staff as such, but its still perceived as a cost that IT staff must contain?

Benincasa: Exactly. Its across the board. IT has to try to stop it. Its hard to do, so the users have to go through their mail, and they waste a lot of time.

Coffee: One of the things that has popped up on the radar is the question of whether IT costs, especially in areas like software development and data entry and user support, can be reduced by going to non-U.S. providers. Are any of you actively exploring offshore providers, or are any of you having experiences where you find yourselves dealing with offshore providers that have been subcontracted by your name-brand IT providers?

Rabuck: Obviously, there are issues related to H-1B visas that are still out there, and Im not sure the solution is just sort of cutting those sources off. I mean, we have to realize its a global world now, and thats the reality of it. If the service can be purchased somewhere else, Im not thrilled with the concept, but its going to happen.

Smith: Were not evaluating or considering offshore types of development initiatives. I think that even though there may be some cost breaks, to me it is not just a cost issue; its a manageability issue. Its trying to control quality and resources and get better integration of project teams so that we understand exactly what were going to be doing and how were going to be going about it, so that we dont have to make more corrections the further we get into an implementation cycle. So Im not even considering the offshore component at all.

Coffee: One of the things weve heard a lot in the last year is that, with a lot of good people out of work, the pool of highly experienced candidates is bigger than it used to be. On the other side, people whose 401(k)s have really taken it in the chops are perhaps postponing retirement, and therefore you have fewer new people coming into an organization and bringing with them familiarity with and training in new technologies. How has the economic environment affected your ability to recruit and also to retain and retrain the people you already have?

Rosen: Were under a hiring freeze, so we just hire more contractors. But what we see is a lot more applicants to the contractors, a lot more puffery in their résumés. So theres a much broader spectrum of people applying for jobs because youre really trying to find the right people for the job. Its almost just as tough as it always was.

Coffee: Do you think people are being driven by a perception that they have to list certain key buzzword skills on their résumés?

Rosen: I think thats part of it, especially as people move more and more to [computerized] résumé processing, where a system is just looking for keywords.

Brown: Im seeing a shotgun approach to sending out résumés, which makes it real difficult to go through them.

Smith: I think youre seeing some underlines of underemployment come through on the résumés—people who are employed in jobs that they really dont want to be in, but theyre working in those areas. Theyre not paying as much attention when theyre actually submitting their résumés.

Coffee: So the perverse result of all of these people out in the labor pool is that your recruiting job is actually getting more difficult because the noise level is so high?

Smith: I think it is.

But when you look at your total cost of identifying and recruiting and bringing a qualified person on board, its actually not going down very much.

Smith: I wouldnt think it would be going down. I would be willing to guess that it might be flat or rising a little bit.

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Peter Coffee is Director of Platform Research at, where he serves as a liaison with the developer community to define the opportunity and clarify developersÔÇÖ technical requirements on the companyÔÇÖs evolving Apex Platform. Peter previously spent 18 years with eWEEK (formerly PC Week), the national news magazine of enterprise technology practice, where he reviewed software development tools and methods and wrote regular columns on emerging technologies and professional community issues.Before he began writing full-time in 1989, Peter spent eleven years in technical and management positions at Exxon and The Aerospace Corporation, including management of the latter companyÔÇÖs first desktop computing planning team and applied research in applications of artificial intelligence techniques. He holds an engineering degree from MIT and an MBA from Pepperdine University, he has held teaching appointments in computer science, business analytics and information systems management at Pepperdine, UCLA, and Chapman College.

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