Survey reflects importance of business service management

With all the hype lately around business services management, last month I asked readers if they thought BSM tools were more important than technologies to optimize performance of networks, servers and applications.

Recently I found a Yankee Group survey that semi-answered this question for me.

It showed that optimizing the business value of IT is a priority among the 175 IT executives from mid-size to large companies surveyed. The reasons business technology optimization (or BTO, as Yankee Group refers to it) projects should be a priority include: aligning IT with business strategy; IT governance issues; optimizing application quality, performance and business availability; and reducing IT costs.

Yankee Group’s definition of BTO encompasses people, process and technology means to “take over spiraling complexity and rising IT costs by taking a more coordinated approach to testing, deploying and managing enterprise applications” to ensure peak performance and return on investment. Yankee Group says tools to better organize inter-related projects and to manage people overseeing IT systems are also important, as well as getting visibility into long-term performance and remediation processes.

In fact, interest in BTO is so high, Yankee Group forecasts the market will grow at 21% annually until 2007 and reach $3.3 billion worldwide in 2004, up 18% from $2.8 billion in 2003. Yankee Group projects growth will continue to $6 billion by the end of 2007.

The survey showed that 60% to 70% of current IT budgets goes toward maintaining systems, and less than 30% of the budget goes to new application development. With BTO processes and tools in place respondents say they expect the costs associated with applications could be reduced by 15% to 20%.

Respondents also agreed that IT departments will have to lead the push for BTO, the Yankee Group found. Survey respondents said the top membership on a BTO panel should be as follows: IT management (96%), business unit leaders (76%), CFO (52%), security management (35%), COO (34%) and CEO (28%).

According to Yankee Group, “The high involvement of line-of-business leaders bodes well for BTO, but the relatively low attendance of CEOs means BTO issues remain the bailiwick of the IT and operations staff, at least from their perspective.”