Beware of solutions looking for a problem

Johannesburg — 30 Jun 2003 — It was not too long ago when it seemed businesses revolved around technology and having the latest upgrades, and the newest, bleeding-edge technical solutions reflected well on the company and its management team.

Those were the days when the Internet was everything and business plans in which more than 5% of the words were either ".com", "Internet" or prefixed with "e-" guaranteed a fantastic stock exchange listing and even more fantastic wealth.

But just as the dotcom boom proved to be more hot air than real investor value, so technology for technology's sake has failed to deliver value.

"After spending 26 years in the IT industry, I have discovered that as long as there are geeks inventing new technologies and slick salespeople, there will be gullible people buying the latest and greatest technical solutions without knowing exactly why they are buying them and what they are for," states Rick Parry, MD of Progress Software SA.

"The ICT industry is continually coming up with new fantastic-sounding solutions without knowing how and where they can be applied in the business sense. The common methodology of developing technology had been to wait for a bright techie to have an idea and create a product. The sales team then kicked in and through slick manoeuvring and second-hand car sales tactics, convinced customers they needed this particular solution," he adds.

Phrases used to support these sales included "competitive advantage", "return on investment" and "business critical". Of course, nobody ever defined how their technical products delivered these, but the pitch was good and everyone else was doing it.

"Is it any wonder that ICT has taken a beating over the last few years as companies stop and wonder what it is they have been spending money on and why," Parry asks. "Does anyone but a teenager really need a cellphone with a colour screen? PDAs are extremely useful as organisers and contact lists, but how many people really need to have their Palm in constant contact with the office via the mobile Internet? And for those who want a wired home, how critical is it to have a fridge that uses its built-in Internet connection to order milk for you when you open the last bottle?"

No real value

The industry has not only been marred by technical solutions that have no real value, but also by solutions designed for business that never managed to deliver, or to deliver as promised. For example, the Standish Group reports 31.1% of IT projects will be cancelled before they are completed. Furthermore, 52.7% of projects will cost 189% of their original cost estimates.

There can be no doubt that individuals and companies need technology. There are lists of inventions that have made life simpler and easier, and no one would recommend the end of the innovative side of IT. However, new technology should be designed to save time, money and effort, and, above all, deliver value.

Parry continues that even some of the hottest buzzwords around today, such as CRM (customer relationship management) were never created as a result of actual business requirements. Rather, someone decided that a bundled technical solution would be a great way to handle the burden of looking after customers.

"While the idea of having an application take care of your customers for you is a welcome relief from the human resources burden most companies need to carry when dealing with customers, technology is not able to manage a relationship," says Parry. "That is not to say the whole idea of automating customer interactions is a failure. Many of the components falling under the banner of CRM are useful (such as helpdesks and self-help systems), but as a whole the concept has failed because the technology was not designed with the specific needs of business in mind."

Successful technology companies do exist. The common thread that runs through all of these organisations is not a desire to develop the next "killer app", but to deliver solutions that business requires.

"We, as technology companies, are in the solutions business," concludes Parry. "Technology is essential in what we do and the service we provide, but only to the degree that it delivers value and is deployed in support of solutions that have been developed in response to clearly identified problems."

About the Progress Company

The Progress Company simplifies the development, deployment, integration, and management of the world's best business applications. Progress and its 2,000 Application Partners offer more than 5,000 Progress-based business applications that precisely fit customer needs and deliver competitive advantage. Customers purchase more than $5 billion annually in cost-effective software and services from Progress and its partners.

Progress® OpenEdge® platform enables its partners to deliver lowest cost-of-ownership applications that are rapidly implemented and easily integrated within and across the extended enterprise. The Progress Company is an operating unit of Progress Software Corporation (NASDAQ: PRGS) headquartered in Bedford, Mass., and may be reached at www.progress.com or +1-781-280-4000.

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