Wednesday, September 24, 2003

Are Web Services Really the Answer?: "This is Part One of a two-part series on the current state of enterprise IT by Ray Lane, General Partner at Kleiner Perkins Caufield & Byers. In it, Mr. Lane lays bare the frustration many CEOs feel these days. ..."

"Enterprises try to do most anything. They try to reorganize; they try to change business policies or practices; they try to acquire a new company or move into a new market sector. And with all this, the number one challenge they have is IT. They're told by the IT department, 'Well, we just can't do that now. You have to wait a couple of years.' So it is not a pleasing experience when everything in the organization reacts except for IT.

"If you're a CEO, you have every department business function with different technology that has different standards, different data definitions, different ERP methods, different semantics, different automation competencies. So when you try to do something that is cross-departmental or cross-functional, it is extremely hard to do. ..."

"The CIO's perspective is different. If you're the CIO, then you're caught in the middle. You're in a very precarious position. First of all, you know the CEO is not happy about the responsiveness of IT. At the same time, the CEO wants expenses reduced, so you can't spend your way out of the problem; you can't innovate your way out of the problem. ..."

"... if you're going to reduce the expenses to the enterprise, now it has to be structural, it has to be something that comes out of the fixed cost base, and to do that you have to spend money. So you've got a Catch-22. You can't spend money to get the structural costs out. ..."

"The software industry's answer to all this is Web services. That's the next big thing. It's supposed to solve a lot of problems. When you talk to most of the large suppliers, they spill a bunch of acronyms and say all this will allow you to integrate. But it won't; it just won't. There are standards, and certainly messaging and integration are easier, but we don't know yet how to handle the semantic differences..."

"The enterprise is very lost. It's as if you came to the Bay Area for the first time and wanted to get to Oakland. You're there at the airport and you stop to ask directions of ten different people, and they are all experts only on their own little locale. So they can tell you how to get anywhere in Atherton or Woodside, but all they know about Oakland is that it's somewhere to the east. What are you supposed to do with that?

"That's how the enterprise feels today. Everybody is giving them a way to get there that is only a partial solution; it gets them only so far. What they need is for someone to say 'I'll just drive you there for 50 bucks. I'll get you there.'"

How sad is it when the department, IT, with the most potential for enabling an enterprise to function as a responsive organism is, in fact, the least responsive.

Perhaps that's due in part to a lack of acknowledgement by those on the executive management level of the overarching nature of IT within an organization. As in, not only is the CIO held back by budgetary constraints as described above, but also by access and other political hurdles.

It helps to have humility within the organization to lower those barriers. That is, if IT can't be allowed to rise to that level, perhaps others can more voluntarily lower the barriers to communication.

But more than that, everyone needs training in how they can best be responsive and effective with IT. The problem is, few folks in IT itself fully understand their potential, much less have the communication skills to teach others even if they did understand.

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