Google exec says IT 'crisis' preventing business innovation

Outsource core IT functions, including security, Google VP suggests.

Google’s general manager of enterprise business Tuesday said a “crisis” in IT is preventing enterprises from pursuing the type of innovations that allow businesses to grow.

Speaking in Boston at the Mass Technology Leadership Council’s annual meeting, Google’s Dave Girouard said the “insane complexity” of technology is leading companies to spend 75% to 80% of IT budgets simply maintaining the systems they have already. Besides a shortage of money, Girouard notes CIOs face strict regulations and an impending brain drain with many IT officials approaching retirement.

“The way Google built what is on the order of a $10 billion business in eight years was through some pretty amazing innovation,” said Girouard, who is also a vice president at Google. “CIOs in particular are really in a difficult situation, and innovation isn’t something they can spend the majority of their waking hours talking about. The information technology business as it pertains to large businesses has become a lot of maintenance.”

Girouard promoted the software-as-a-service model, saying companies should join this growing trend of outsourcing IT tasks, even if it means trusting third parties with sensitive information.

A century ago, most large companies had a vice president of electricity, according to Girouard. Just as the management of electricity became routine, Girouard said, so will many IT functions.

“A lot of things that people think of as core IT functions need to disappear into the ether so that the IT organization can properly focus on the value-added [activities],” he said. “Information security, as critical as it is, needs to be taken care of by organizations who live and die by it, who invest the money, time, resources and staff. Why should every company in the world have to build up their own expertise and have to maintain servers and provide security?”

Girouard also discussed the “consumerization of information technology,” describing budding efforts to bring the user-friendly features of consumer products to the workplace. Makers of enterprise technologies tend to add lots of features as a way to improve a product, but instead the extra bells and whistles often make products so complex they detract from the user experience, he said.

At Google, “our users are one click away from using another search engine, so we live this Darwinism every microsecond of every day. It really drives an incredible focus on the end user experience that I think the enterprise technology market could benefit from,” he said.

Girouard discussed “Google Apps,” the company’s attempt to carve a niche in the enterprise applications arena. It consists of an e-mail service, instant messaging, a calendar service and Web page design program.

Launched several months ago, the service is free for organizations accepted by Google during the beta test period. Companies that want to register an Internet domain can do so for $10 per year when they sign up for Google Apps.

Most CIOs would probably hesitate before using Google Apps, but the new tool or similar ones are bound to catch on eventually, said Whit Andrews, an analyst at Gartner, in a phone interview today.

“The vast majority of CIOs today see something like this as being interesting but at the very best, pilot project class,” Andrews says. “They’re worried about security, they’re worried about disconnect, they’re worried about service-level agreements, they’re worried about training.”

Google Apps probably lacks many features available today in Microsoft products, Andrews says. But Google has an opportunity to take advantage of a trend in which “consumers are bringing their predilections for ease of use and simplicity to the workplace,” he says.

The question for Google, according to Andrews, is “can they force themselves to behave somewhat like Microsoft? If they can, this is an enormous opportunity for them in the enterprise.”

Google Apps has hundreds of thousands of end users at hundreds of universities and tens of thousands of small businesses, Girouard said.

Addressing security concerns, he said Google’s systems are designed for anonymity. “Even if you broke into a Google data center and wanted to find the information for a particular company or customer, you really would have no reasonable means of doing so.”

Girouard was one of two keynote speakers today, the other being Deval Patrick, the newly elected governor of Massachusetts. Patrick confessed to having a limited knowledge of technology, but promised that Massachusetts will make it easier for companies to do business.

Patrick said he is hiring the state’s first “permitting ombudsman” as part of an effort to speed up the permitting and regulatory process to make it move “at the speed of business.”

“I want to say, unequivocally, that Massachusetts wants you,” Patrick said. “We want your companies, we want your jobs, we want your growth.”

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