CIO Shopping Lists, Wish Lists

PORTSMOUTH, N.H. — Recent studies indicate that large corporations and government agencies are beginning to spend again on IT. So what are they buying?

A panel of CIOs here at the Future Forward ’03 conference offered its insights, as well as a wish list of what they would like to see from vendors.

“We’re working on projects that facilitate collaboration,” said Doug Schwinn, CIO of toy giant Hasbro. “We want to take advantage of the information that is in our organization, whether it’s in the U.S., Asia or Europe and put that information together to produce products customers want.”

Terry Conner, CIO of Liberty Mutual, said security is more of a concern than ever. Whereas precautions once were left mainly to the IT department, now upper management is keenly aware of the expanded threats.

“The walls (to the network) are down,” Conner said. “People can come in and do self-service and make changes. Businesses have to be concerned with who they are. Security and privacy are part of the conversation of business now.”

John Halamka, CIO of CareGroup, echoed those thoughts and said that not only is the network more vulnerable because of customer access, but also because of employees who are connecting via laptops from home and wireless devices.

Halamka said his department is spending money both on the desktop for anti-virus software and encryption technology and on network vendors and enterprise software companies to secure systems. Other products and services falling into this category are anti-intrusion technology and the hiring of so-called “ethical hackers” to probe corporate systems for vulnerabilities.

Another inescapable expense is for compliance with new federal regulations for several industries including financial services(Sarbanes-Oxley), health care (HIPPA) and international trade (Patriot Act).

For example, health care regulations require that hospitals and providers retain patient records for 30 years. That dictates a significant investment in storage, Halamka said.

The CIOs present said the number of vendors they were using was shrinking and includes the biggest names in the industry: Microsoft, Hewlett-Packard, EMC and Cisco were among those mentioned.

Some audience members who worked for smaller companies bemoaned the practice, saying it made it difficult to make the step from a successful, small company to the next level. Several CIOs agreed and said they have to weigh the risk of dealing with a company that could go under with the need for the product.

That doesn’t mean IT shops won’t consider a startup’s technology if it solves a problem. The key is knowing how to get to them. CIOs receive hundreds of pitches for meetings, but the gatekeepers are often one level below. Most companies have a committee to screen new technology.

Justin Lindsey, CIO of the FBI, said there also are opportunities in the federal sector. The CIA, for example, has its own venture capital arm that scouts for new products of use to the intellgence community. Likewise, the Department of Homeland Defense has more than $4 billion earmarked for technology investments.

Workding with the government can involved more steps than the private sector, but it’s another avenue. In addition, once technology is vetted with the government, it can open other doors.

Finally, there is room for companies who can fill a need.

Conner and several other panelists said they are still looking for a product that provides a dashboard view of the performance of all their IT systems, including information on the performance for users out on the network. Some vendors have claimed they could build such a view, but it would involve “millions of dollars and five years to get there,” Conner said.

“It’s probably a pipe dream.”