Know How

Know-how USING GARTNER RESOURCES FOR BUSINESS GROWTH

For the CIO of a large automotive supplier, it’s not just business, it’s personal:

“I manage extraordinary change while striving to keep service levels high. With Gartner Executive Programs, my advisor personally directs me to the research I need, puts me in touch with others like me and takes individual interest in my agenda.”

Gartner Executive Programs.

We get personal with more than 3,000 CIOs. More than 3,000 senior IT executives receive preferential and personalized access to Gartner through their membership in Executive Programs. But it doesn’t stop there. Gartner Executive Programs participants apply member-driven research, expert advice and the shared intelligence of an exclusive community to help their enterprises grow, compete and operate more effectively. CIO members of EXP Premier and CIO Signature access Gartner insight through a dedicated relationship manager, and their direct reports reap the rewards of topic-based peer exchange through Gartner Best Practices Councils. CIOs who seek professional development of the highest caliber attend CIO Academy.

We are ready to take personal interest in your IT agenda. Learn more about Gartner Executive Programs by visiting gartner.com/executiveprograms.

RESEARCH

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EVENTS

EXECUTIVE PROGRAMS

[ contents ] 03 welcome

“No independent IT research and advisory firm in the world is

better known than Gartner.”

04 conquering complexity “What

you’ll find, at

best, is a kind of ‘Whack-A-Mole’ syndrome, where complexity is reduced in one part of an operation when it is optimized, but just moves down the line to another domain.”

08 interview with gene hall “Our

pivotal advantage is our

sheer number of analysts. Our 600+ analysts are out every day working with end users and technology providers. We provide broad, deep coverage in any given topic area.”

12 gartner research “We

compete with many purveyors of

information, but no one offers the same breadth and depth of research and opinion, or the same independent viewpoint.”

18 gartner consulting

“If you were

to ask me our primary goal at Gartner Consulting, that would be it: Help the CIO succeed.”

24 gartner events “We

create an environment rich in insight and

education based around Gartner rigorous, independent research. There’s future-looking content that people want for strategizing. There’s also plenty of practical, real-world content.”

30 gartner executive programs

“At all levels,

Gartner Executive Programs is focused on the success of the individual members, their teams and how they can contribute to the success of their enterprise.”

35 gartner books “Most

CIOs today are excellent managers, but

relatively few have stepped up to become leaders, true enterprise leaders. And there is a crucial difference between leadership and management.” 38 case studies “With

help from Gartner, the client selected an outsourcer with

the necessary delivery capabilities and a good understanding of what this client needed to be more competitive.”

40 talent pool “Hopefully,

you can

either admit you are wrong and move on, or get ahead of the curve of everybody else and change a position when warranted.” ©2005 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner and ITxpo are registered trademarks of Gartner, Inc. or its affiliates. gartnerknowhow20051018

gartner know-how | 1

Symposium/ITxpo

Summit Events

May 15 – 19 San Francisco, California

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EMEA

Business Intelligence Summit Customer Relationship Management Summit Wireless & Mobile Summit Outsourcing & IT Services Summit METAmorphosis 2005 Enterprise Planning & Architecture Strategies Seminar Application Integration & Web Services Summit IT Security Summit Data Center Summit

January 31 – February 1 March 3 – 4 April 18 – 19 April 25 – 26 May 24 – 26 June 13 – 14 June 23 – 24 September 14 – 15 November 29 – 30

London, England London, England London, England London, England Johannesburg, South Africa Amsterdam, Netherlands Barcelona, Spain London, England Amsterdam, Netherlands

Application Development, Integration & Web Services Outsourcing & IT Services Summit IT Security Summit Business Intelligence & Enterprise Portal Summit Sourcing Summit Application Integration & Web Services Summit IT Governance Forum (in conjunction with JUAS)

April 27 – 28 June 7 – 8 July 18 – 19 February 15 – 16 April 19 – 20 June 21 – 22 September 6 – 7

Sydney, Australia Sydney, Australia Melbourne, Australia Tokyo, Japan Tokyo, Japan Tokyo, Japan Tokyo, Japan

Application Integration & Web Services Summit Application Integration & Web Services Summit Outsourcing Summit Outsourcing Summit Economics of IT Conference Economics of IT Conference

March 30 – 31 April 6 – 7 June 20 – 21 June 28 – 29 August 23 – 25 August 31 – September 1

São Paulo, Brazil Mexico City, Mexico Mexico City, Mexico São Paulo, Brazil São Paulo, Brazil Mexico City, Mexico

®

May 22 – 25 Barcelona, Spain October 16 – 21 Orlando, Florida November 7 – 11 Cannes, France November 15 – 18 Sydney, Australia November 30 – December 2 Tokyo, Japan

Asia/Pacific

Latin America

Gartner Events.

Straight talk on the issues that matter to you most. Gartner offers a wide range of events designed to deliver the very latest thinking on all areas of information technology. Symposium/ITxpo is our flagship event, the IT industry’s largest and most strategic conference, covering the entire spectrum of enterprise IT. And Summit Events focus on specific topics and technologies that are top of mind for today’s business and IT professionals. For the most up-to-date calendar, or to learn more about Gartner Events, visit gartner.com/events.

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[ welcome ] Knowing Gartner. No independent IT research and advisory firm in the world is better known than Gartner. Yet many of our clients only know the part they are accustomed to experiencing. Relatively few clients of Gartner Research, for example, know that we also operate a highly valued consulting organization that helps business and government clients around the world solve problems and stimulate growth through technology. Likewise, clients of Gartner Consulting and Gartner Research aren’t always aware of Gartner Executive Programs, the largest membership organization of CIOs in the world. And delegates to Gartner Symposium/ITxpo® often don’t realize that Gartner Events operates more than 60 events worldwide, many of them specifically focused on issues they need to know more about.

cover illustration by leigh wells

The publication you are holding—Know-how—brings together all the key resources at Gartner and offers advice on how to use them. Our CEO, Gene Hall, talks about the recent META Group acquisition and the new emphasis at Gartner on becoming even more relevant to clients within their specific industries. In four fascinating and candid interviews, the leaders of our four business units explain the value they offer clients. We’ve also highlighted some recent new offerings and insights from our analysts and consultants. And we’ve attempted to show how these four strategic “portals” through which our clients enter Gartner can be applied in combination to achieve the results you want in your business. We hope you find Know-how as valuable as we’ve tried to make it.

produced by gartner corporate marketing Marisa Kopec vp, corporate marketing Priscilla Raymond editorial director Tony Leighton copywriter David Cushman design director Eileen Murphy project manager Bart Bailey-Gates marketing/advertising manager Carol Peck production director Karen Pasacreta, Sally Fay copy editors gartner know-how | 3

latforms. Multiple vendors. New version releases. Old legacy ystems. The real-time enterprise. Outsourcing. Middleware. Multiple platforms. Multiple erver farms. Thevendors. mobileNew network. Multiple platforms. Multiple version releases. endors. New version releases. Old legacy systems. The realOld legacy systems. The realime enterprise. Outsourcing. time enterprise.Middleware. Outsourcing. Server farms. The mobile network. Multiple platforms. Multiple vendors. New Middleware. Server farms. ersion releases. Old legacynetwork. systems. The real-time enterprise. The mobile Doing Outsourcing. Middleware. Server farms. more with less. Doing less The mobile network. Multiple platforms. Multiple vendors. New version releases. because more is killing you. Old legacy systems. The real-time enterprise. Outsourcing. More is killing you. If you’re an Middleware. Server farms. The mobile network. Multiple IT operations manager in a large latforms. Multiple vendors. New version releases. Old legacy enterprise with an ambitious ystems. The real-time enterprise. Outsourcing. Middleware. growth strategy, this statement erver farms. Thecould mobile network. Multiple platforms. Multiple well be true. endors. New version releases. Old legacy systems. The realime enterprise. Outsourcing. Middleware. Server farms. The mobile network. Multiple platforms. Multiple vendors. New ersion releases. Old legacy systems. The real-time enterprise. Outsourcing. Middleware. Server farms. The mobile network. Multiple platforms. Multiple vendors. New version releases. Old legacy systems. The real-time enterprise. Outsourcing. Middleware. Server farms. The mobile network. Multiple latforms. Multiple vendors. New version releases. Old legacy ystems. The real-time enterprise. Outsourcing. Middleware. erver farms. The mobile network. Multiple platforms. Multiple endors. New version releases. Old legacy systems. The realime enterprise. Outsourcing. Middleware. Server farms. The mobile network. Multiple platforms. Multiple vendors. New ersion releases. Old legacy systems. The real-time enterprise. The problem is complexity, Outsourcing. Middleware. Server farms. and it’s getting worse. Like The mobile network. an incoming it’s New version releases. Multiple platforms. Multiplestorm, vendors. rising on real-time the Gartner enterprise. radar Old legacy systems. The Outsourcing. screen because more clientsnetwork. Multiple Middleware. Server farms. The mobile arevendors. expressing New mounting latforms. Multiple version releases. Old legacy frustrations. Complication is ystems. The real-time enterprise. Outsourcing. Middleware. us, and we erver farms. Theworking mobileagainst network. Multiple platforms. Multiple have to fight back.Old legacy systems. The realendors. New version releases. ime enterprise. Outsourcing. Middleware. Server farms. The

storm

GREG MABLY

front

gartner know-how | 5

“People are feeling that the complications they deal with—more and more technology becoming more and more sophisticated—is causing them to suffer, that they really can’t get their arms around it any longer.”

Complexity is more than an irritation. It’s having a serious impact on IT productivity. It’s the No. 1 reason for IT project failure. More than 50 percent of the world’s computing resources are involved with nothing more than format conversion. And as complexity grows with the demand for flawless business services, IT professionals are wearing down. To cast more light on the subject, a team of Gartner analysts has been studying IT complexity and bringing their findings to Symposium/ITxpo under the title “Conquering Complexity.” All of them agree that complexity is never really conquered—you can only hope to control it—and controlling it is a much-needed strategy in many enterprises. Complexity impacts people more than technology. People are suffering, according to Carl Claunch, who leads the team of Gartner analysts focusing on this issue. “People are feeling that the complications they deal with—more and more technology becoming more and more sophisticated—is causing them to suffer, that they really can’t get their arms around it any longer.” Claunch points to the explosive growth of data centers, the blizzard of new applications being developed and, on a personal level, the array of devices most business people carry to access the network. “Compare that to the mainframe environment of 20 years ago when there were maybe two or three systems to manage,” he says. “Controlling this huge multiplicity of systems causes enormous stress.” 6 | gartner know-how

What’s Driving Complexity? It grows like mold. Complexity creeps. In information technology, it always has. New hardware and software are lashed to the old stuff, and there’s never enough time to pause and take stock. Just add more servers. Geek testosterone. Complexity amongst many hardcore IT professionals is like a badge of honor. “Some people are always trying to prove they can live in that environment,” says Claunch. “It’s like showing you can function with the heat at 130 degrees. But why?” Territorial complexity. Claunch says some people build complexity into the systems they operate as a form of job security. It might be a sprawling database or a temperamental application. The perception will be that the person running it is irreplaceable. Perceived value. Think of Microsoft Word. The more features you add in new releases, the more you can charge, but it doesn’t necessarily add value for the user who doesn’t need 95 percent of the complexities. Nobody is minding the store. The simplification of complexity is one of those soft issues that doesn’t normally have an appointed champion. As we push more complexity into the organization, there’s no gatekeeper or sanity checker or CSO (chief simplification officer). “What you’ll find, at best,” says Gartner Analyst Simon Hayward, “is a kind of ‘Whack-A-Mole’ syndrome, where complexity is reduced in one part of an operation when it is optimized, but just moves down the line to another domain. “This is one of the big challenges for organizations,” says Hayward. “They have to start taking that holistic view of things from the highest level, so they actually achieve some global optimization rather than just a local optimization.” What Is the Cost of Complexity? 1. Things break down more often. 2. Problems are more difficult to diagnose. 3. There’s more risk of error. 4. Availability is at stake. 5. Higher staff costs (and health costs). 6. Longer learning curves. 7. Innovation and initiative are stifled because people are unwilling to tinker with a fragile environment.

Complexity Self-Test Try this quick self-assessment to see if your organization suffers from too much complexity: ❏ Unable to make corporate decisions?

❏ Reduced inter-team working due to groups looking out for themselves rather than the larger company good?

❏ High turnover of staff as a result of a highly

stressful, uncertain environment? • Indecision—rapid change, complexity and unclear ❏ Experiencing personal impacts? decision rights—slows decision times to a crawl • Personal stress health impacts on • Lack of decision rights: can’t tell who has the right individuals, such as high blood pressure to make a decision (related to the first point) • Use of all-caps in e-mails • Uncertainty of responsibility ❏ Eroding control of inventory, ordering, billing and asset ❏ Executives departing, either by choice or by force (perhaps also causing organizational tracking causing delivery and billing mismatches and stress)? delays, loss of assets, etc.? ❏ Problems communicating, including lack of ❏ Unable to resolve problems quickly? communication to the outside world as well • Unresolvable software and hardware as inaccurate/confused/complex internal incompatibilities and change control challenges communications? leading to software and hardware failures, loss of functionality and security risks ❏ Complexity in all enterprise applications (CRM, ERP, SCM, accounting and HR) causing excessive • Retention of legacy systems as workarounds process errors and delays? • Lost availability • Reduced system reliability ❏ Highly inaccurate revenue/earnings forecasts due to lack of visibility and complexity?

Is Complexity Always a Bad Thing? No. “That’s one thing that’s becoming obvious,” says Claunch. “You can’t say that complication is always bad and that the simpler something is, the better. Think of a unicycle. It’s very hard to operate. Now think of a Segway, the personal transport device. It’s much more complicated from a technology standpoint, but far easier for the user.” Says Hayward: “If you look at service-oriented architecture, there are cases where it increases complexity and others where it definitely reduces complexity. The challenge is to get the complexity where you want it, or where you get greatest advantage from it.” The rule should be when complexity improves things—such as functionality, resiliency, redundancy or agility—then it’s “good” complexity that needs only to be managed. When it clearly harms or inhibits things— slowing them down, creating work that isn’t productive and stifling innovation—then it’s “bad” complexity that needs to be eliminated.

Is Anyone Doing It Right? The same companies that have leveraged IT for massive business growth are also managing complexity well. These are process-focused companies such as Amazon, eBay, Wal-Mart and JetBlue. It’s built into their ethos to use technology, but not get used or hindered by technology. There are other anecdotal examples cropping up everywhere. For example, a global energy company that used to manage desktop computing like most other large corporations—through centralized control—is now allowing all employees to be responsible for their own computing environment. The centralized method was frustrating for the user, and applications were constantly out of date. Under the new way, there are almost no complaints because employees serve their own needs. Where Do You Start? Recognizing complexity as a problem is the first step. “People in operations tend to be fatalistic about it,” says Hayward. “It comes at them steadily. They accept it as part of the job. But it doesn’t have to be.” Having recognized complexity and begun to understand its impact across the enterprise, it’s imperative to appoint someone to analyze it accurately. Gartner is advocating an approach that Hayward and Claunch are calling Value of Complexity. It’s essentially a cost/benefit analysis of your complexity based on best practices across the world. “In each and every area where we do research, we are collecting best practices from customers,” says Claunch. “These represent guidance as to the best value of complexity and, correspondingly, as we work with people who have problems, we’re discovering where there’s much needless complexity. In this way, we are arriving at a formula for finding the best points of balance.” “At the end of the day,” says Hayward, “complexity is all about how people interact with the world around them, whether it’s the technology world or other people. It is about interaction. When complexity crosses that boundary point where it overloads people, then you have to do something about it. It’s hurting them and the enterprise.” ■ gartner know-how | 7

d

Gene Hall joined Gartner as CEO in mid-2004 and has already had a major impact on the way the company does business. His immediate goals: deeper and broader research (through the meta Group acquisition), more industry-specific research and a greater worldwide presence for technology’s No. 1 independent authority.

deep insight PHOTO: TRACEY KROLL | DIGITAL ILLUSTRATION: DAVID CUSHMAN

an interview with Gene Hall What do you see as the Company’s central value proposition to clients? Being a technology professional is a tough job. Change never stops. Products from technology providers get updated constantly. There are security threats to worry about. Internal and external systems have to work without a hiccup. Expectations from business units are always high. These are fun jobs if you like technology, but they’re extremely demanding jobs, nevertheless. What we do is provide technology professionals with the insight and information that can help them succeed in these demanding jobs.

What’s the ROI Gartner provides? We can be the difference between a $50 million IT project succeeding or failing, between a CIO performing at a high level or getting fired for not doing a good job, between paying a 20 percent premium for big IT procurements or paying only what’s fair, or between having a major security breach that costs you $40 million or being prepared because Gartner warned you about it and prepared you for it. Frankly, our value proposition is among the best I’ve ever seen, and I’ve seen many companies, thanks to my years at McKinsey. Clients usually spend less than 1 percent of their IT budget on Gartner. For that, you get a tremendous wealth of practical, applicable advice you can’t get anywhere else. We have more than 600 analysts who are constantly thinking of what will make the difference between success and failure in our clients’ businesses.

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“What we do is provide technology professionals with the insight and information that can help them succeed in [their] demanding jobs.” What do you see as Gartner’s competitive advantage over others who say they provide the same thing? Our pivotal advantage is our sheer number of analysts. Our 600+ analysts are out every day working with end users and technology providers. We provide broad, deep coverage in any given topic area. Our analysts are seasoned professionals with years of industry experience; they are not recent college graduates. Let’s say a technology provider has recently offered a new product that’s supposed to improve availability. A Gartner analyst can tell you which companies have used it successfully and why, which failed to use it successfully and why, whether or not it will work in your environment and what you’ll have to do to make it work. There’s nowhere else in the world you can get that same insight. Gartner is always emphasizing its independence. Why is that so important? It’s this simple: If you get IT product or service advice from someone who has a vested interest in your deciding one way or another, that person is not acting independently and that demonstrates a conflict of interest very well. At Gartner, we don’t have a vested interest in your deciding one way or another; we are only interested in what’s right for you. There is simply no conflict of interest. What is top of mind with Gartner clients today? There are several issues, depending on the particular client’s situation. There’s a continuing focus on being efficient—reducing costs. It doesn’t necessarily mean that the IT budget is going down, although that could be, but people want cheaper per-unit costs. Security is another major issue. People worry about security. It’s almost as though you can’t do enough because the thieves are becoming more creative every day. In many industries, compliance and regulatory requirements are a big issue. If you want to know the big issues of today, just look at the content of Symposium/ITxpo. Open the conference program. Run your finger down the list. This event reflects what our analysts and consultants see in the real world. What changes are you and the Company making to better respond to the challenges facing your clients? We are making sure we are as deep and broad as we can be on every topic that’s important to our clients. We acquired META Group largely for that reason. META will also help with specific industry solutions, which are increasingly important to our clients. META will help us answer questions like, “Which industry-

EXECUTIVE SUMMARY

Family Married to Beth Education Bachelor’s in mechanical engineering, Massachusetts Institute of Technology; master of business administration, Harvard Business School

One of your personal priorities is to ensure that clients know there are multiple ways to solve problems with Gartner—Gartner Research, Gartner Consulting, Gartner Events and Gartner Executive Programs. Can you

Book You Read Most Recently “Securing and Optimizing Linux,” Gerhard Mourani Book You’re Currently Reading “H.M.S. Surprise,” Patrick O’Brian Recent Movie Seen “The Aviator” Favorite Web Site tomshardware.com

10 | gartner know-how

What are the other reasons the META acquisition is good for Gartner clients? Our two companies have complementary research coverage. One of our strategic objectives is to make our analyst coverage superior by an order of magnitude to anything else in the market. META was covering some areas better than we were, and vice versa. Put the two together and clients get the best of both. Clients can definitely expect an enhanced product in the year ahead. Secondly, there’s a huge need and opportunity for research and advisory services around the world. We started in the United States, so that’s where our largest client base is. Today about 40 percent of our business is from outside the United States, and one of our priorities is to grow this over time. META had a presence in several countries outside of the United States; combining this with Gartner’s international presence, we will be able to serve non-U.S. companies better than ever before. Finally, the merger will give us better sales coverage. Frankly, our sales force has been spread too thin to offer the level of continuity we would like. The combined Gartner/META sales force will address that.

Gene Hall

Age 48

Position CEO, Gartner, Inc.

specific software should I use?” or in retailing, “How do I maximize RFID?” This is a whole new growth area for Gartner. Finally, we are making it easier for clients to do business with us. For example, it can be difficult to schedule time with an analyst, so we’re re-engineering that process.

PAUL ANDERSON | IMAGES.COM

elaborate on this? Many clients use only one of our businesses; they are getting only part of the value we can provide. Gartner is designed to deliver research and advice four ways. Gartner Research is our core offering. It’s the collective work of our extraordinary analyst community. We deliver our analysts’ original thinking and data analysis through our four businesses, which all have different approaches. Some people find it useful to go to an intensive conference like Symposium/ITxpo or one of our other events to be immersed in the very latest research and opinions on key topics. For CIOs, we highly customize access for their specific needs through Executive Programs, where they have a personal relationship manager and one-to-one service and guidance. Others prefer Web access via a Gartner Research seat and gartner.com. Finally, Gartner Consulting offers hands-on business and technology counsel from that unique Gartner vantage point. What are you planning to talk about at the Symposium/ITxpo events when you address the delegates? The theme of Symposium is conquering complexity. Before coming to Gartner, I was responsible for technology at ADP, a Fortune 500 global technology and services company with about US$8 billion in revenues. Part of my job was to lead a 1,600-person software development and IT operations organization that introduced new, high-growth products. Minimizing complexity was essential. In most industries, change happens at a much slower rate than it does in IT. Information technology is not only extremely complicated, but changing at a rate that never lets up. You have a firewall from one vendor, a Web server from a different vendor, an enterprise suite from a different vendor, other hardware from other vendors, databases, monitoring tools, etc. And all those things are on different release schedules with patches and fixes and incompatibilities that arise. There are tens of millions of lines of code and in some cases, the guys that wrote the code are gone and there’s no documentation. Add to that thieves and hackers and viruses, and the pressure to grow the business through technology. Oh, and everything has to run without a hitch 24 hours a day, seven days a week, 365 days a year. Our role at Gartner is to figure all that stuff out and distill it down on behalf of our clients into reliable data, well-researched opinions and practical advice they can use every day to remove the complexity, make the right decisions and sit back and take a breath. We help them not only cope but be successful—to get ahead of relentless change and make it work in their favor. To my mind, that’s incredibly valuable. ■

The META Acquisition:

Opening More Doors Gartner completed its acquisition of META Group in April. Why was it done? Two words: bigger and better. Clients of both companies will benefit from the powerful combination of products and services from both companies. Expect: Broader research scope in general. Broader international coverage. Greater industry-specific depth. Greater depth of technology coverage. More comprehensive consulting and measurement services. More analysts and consultants. META Group clients can now access the Gartner Research database and confer with Gartner analysts and consultants. Likewise, Gartner clients now have access to META Group products and services that will be integrated into Gartner. META will also expand the Gartner sales effort, with more sales representatives to improve client service, and greater penetration beyond the traditional Gartner client base. “There’s a huge need and opportunity for research advisory services around the world,” says Gene Hall, Gartner CEO. “We have been quite U.S.-focused, even though 40 percent of our published research comes from outside the U.S. With META, and its more developed foreign business, we have an opportunity to reach out to a much broader non-U.S. client base.” gartner know-how | 11

12 | gartner know-how

DAN YACCARINO | IMAGES.COM

Gartner Research is the heated core of all our businesses, the source of data and insight that flows continually from more than 600 Gartner analysts around the world.

brain trust In this interview, Peter Sondergaard, senior vice president of Gartner Research, explains how we help clients solve their business problems and how they can better help themselves leverage Gartner resources.

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Gartner Research sits at the intersection of a huge network of users, technology providers, the academic environment and the investment community. 100% independence. Founded in 1979, Gartner now has more than 600 analysts worldwide servicing 10,000 client organizations around the globe. Our position as technology’s No. 1 authority is based largely on our independence. Here’s how we keep it clean. Hard-wired: To begin with, independence is an unassailable value of the Company; it is hard-wired into the organization. Independence for Gartner is an irreplaceable business asset. Everyone inside the Company knows it and protects it. Unhindered: The average Gartner analyst has 15 years of experience. One hundred percent of the research they develop is original. Our analysts operate as independent thinkers, free of influence from inside or outside the Company. Their opinions are grounded in a consistent methodology. Arbitrated: Our standards for objectivity are extremely high. They are defended and upheld by the Gartner Office of the Ombudsman, an independent defender of independence. The Ombudsman takes action whenever issues of accuracy, fairness, tone and balance arise.

What are clients of Gartner Research most concerned about today? Our clients want to understand and drive continuous value from information technology to support the objectives of their businesses. How is Gartner making that easier? We help clients distill their problems, and we suggest solutions and options to them. We do that verbally, with text or with graphic models. We also show them what similar organizations in their industry and others have done. We give them choices. The world of technology is increasingly complex because of its deep infusion into business processes, so organizations such as Gartner are becoming increasingly valuable, not only to technologists but also to business professionals running technology projects. They want the complex to be made easier. What is it about Gartner Research that differentiates it from all the other information clients can gather? Gartner Research sits at the intersection of a huge network of users, technology providers, the academic environment and the investment community. The size of the network—and the vast amount of information swirling through it—differentiates us and the size of our community of analysts, who are constantly learning, interpreting and advising. How do clients get value from Gartner Research? Through reading the research or engaging directly with analysts, either over the phone or face to face. The value is in getting exactly the information or advice you need to make a decision, then making the decision with greater clarity. That’s always of value. Who are you competing with, and how is Gartner Research different? We compete with many purveyors of information, but no one offers the same breadth and

EXECUTIVE SUMMARY

Peter Sondergaard

Age 41 Family Married to Marta Armida. Children: Oliver, 8, and Alexander, 5 months Education Master’s in economics, University of Copenhagen Position(s) Gartner: SVP, research content; head of research, Technology and Services sector; sector vice president, research; research and general manager, Gartner Research EMEA; and program director, personal computing research area; International Data Corp.: research director; Scandinavian Airlines Systems: responsible for the integration of PCs between hotels and SAS data Company Most Admired LEGO Group. Turning a simple idea of a brick into a global trademark and company admired by adults and children

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Book You Read Most Recently “Pompeii: A Novel,” Robert Harris Book You’re Currently Reading “My Life,” Hans Christian Andersen. The year 2005 marks the 200th anniversary of his birth. He is the greatest storyteller there is Recent Movie Seen Some movie on the plane Major Business Influences I believe strongly in no one being perfect, which is why in business you will be influenced by many people, each adding a little to your personal encyclopedia of business Major Personal Influences My math teacher in Belgium when I was 13, and my parents Favorite Web Site gartner.com (should be obvious!) Favorite Saying “May the IT force with you”

depth of research and opinion, or the same independent viewpoint. Other research companies in the IT field are much smaller and therefore limited in the scope of their research and the final distillation of their opinions. We have many more analysts, a much larger client network and the ability to connect it all. Gartner is able to put teams of analysts together that work on the same topic but look at it from different angles. Often they are based in different parts of the world, or they have experience in different business sectors. The synergy within these analyst communities is remarkable. It leads to the innovative thought process that ultimately results in our research and opinion. Consulting organizations also offer information and advice, but the strategic business consulting organizations are often too close to the big technology providers. The research they present is often supportive of certain products, almost like marketing material. Our critical difference is independence and integrity, and our ability to distill complexity into something that is relatively straightforward and easily explained. Those are the key factors that make Gartner Research the No. 1 source: scope, depth, brainpower and independence. Where is Gartner Research having a major impact on the way clients do business? It’s important to realize that we are literally researching everything of importance in IT, so our impact is pervasive and continual. Pick any topic. For example, we are researching software ecosystems—these huge stacks of software—and there’s a substantial consolidation in the market. That’s one area where we’ve assigned multiple analysts with different kinds of expertise. It’s a complicated topic that requires many minds to be able to interpret what is going on today and what the best steps will be tomorrow. Our research around sourcing has also been important. We have been able to look at sourcing from a business process perspective and advise clients on how to deal with various sourcing frameworks. We have a senior analyst in India who works with our sourcing analysts in Europe and the U.S. to build a highly informed and clearly interpreted body of research. You can only do that if you have people based around the world who talk with many different clients. The best research is largely about recognizing patterns. How do clients want their information, and what is Gartner Research doing to deliver it that way? They want information that’s concise and relevant. They don’t have a lot of time to read, so they want it distilled and quickly recognizable. They also want it in the context of how they engage—in a vertical industry, for example—addressing the primary issues they face and the specific role they play, be it a CIO or an infrastructure architect or a chief marketing officer. We’re answering these needs, first by distilling constantly into clear, easy-to-grasp language and, secondly, by better organizing our work around industries and roles. Gartner Research is like a funnel with an extremely wide top. What else has Gartner Research done lately that clients should know about? We have started to better articulate our coverage agendas. It just makes sense to let your clients know what you’re working on, and to get their input so they have more say in the direction of the research. We’re asking clients to rank what we already do and to recommend new areas of coverage. The research industry has been built around the organizations deciding the coverage. While we don’t want to be entirely client-driven because our people constantly identify things most clients don’t know about, we want to strike a better balance. How do the other Gartner business units—Consulting, Events and Executive Programs—affect Gartner Research? It’s a symbiotic relationship. Gartner Research is the intellectual foundation of the other units; the other units constantly feed intelligence into Gartner Research. Gartner Consulting is a good example. Consultants go into great depth with most of their clients. Gartner analysts provide the research used by the consultant and learn from the consultant’s work. Gartner Events attracts more than 30,000 people to our events each year. Analysts present to the delegates and interact with them. So Gartner events, like Symposium/ ITxpo, are both a platform for validation of existing ideas and a source of new ones. With Executive Programs, we are in steady touch with more than 3,000 CIOs who are driving IT strategy at some of the world’s largest enterprises. Again, they want our research and we want their input. Across the entire Gartner network this give and take is very powerful. Is it part of your mandate to formalize the capture of that intelligence? Absolutely. We are structured to capture ideas, evaluate them, devise new ways of looking at things and then ultimately articulate them in an easy-to-understand way to the client.

Getting the Most Out of gartner.com

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Read the home page first. If you skip to “search” without looking, you’ll miss new First Takes, Magic Quadrants, Hype Cycles and the Monthly Research Review.

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Use advanced search. The filters make it easier to get to exactly what you need. Narrow your criteria for a shorter list of more relevant results.

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Be alerted. Don’t use one or two broad Alerts. Create several specific queries to ensure each one delivers what you need. Make gartner.com work harder for you.

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Use the Focus Areas. Focus Areas will link you to hot research, the most relevant browse topics and suggested searches and Alerts.

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Spend time in Browse. Read the Research Topic Index available in Browse help to get familiar with topics that best match your interest. Browsing will be easier. Scan searching will be faster. gartner know-how | 15

What IT topics are top of mind with Gartner clients? Here are the 10 most popular topics, based on queries to the Client Services Organization. During 2004, Client Services fielded more than 107,000 such queries. Beside each topic are the number of inquiries logged between March 2004 and March 2005. 1) IT Management (2,654) 2) IT Services and Outsourcing (2,337) 3) Semiconductors (2,269) 4) Enterprise Management (1,964) 5) Security and Privacy (1,912) 6) Servers and Storage (1,909) 7) ERP and Supply Chain Management (1,848) 8) Knowledge Support (1,731) 9) Application Development (1,675) 10) Communications Services (1,635)

How can clients make better use of Gartner Research? Using gartner.com skillfully is important. It’s the way to get at everything we publish. Beyond that, it’s important to talk to Gartner analysts, particularly one who’s studying your issue. It’s easy for us to provide written research to clients, but that’s actually only a fraction of what we know. Gartner Research really comes alive when you spend 30 minutes on the telephone or face to face with an analyst. Many people think Gartner Research is a library or a database. That’s only one dimension. The written stuff is reference material that helps you understand the eventual conversation with the analyst, who can explain the most recent findings specific to your business. Can non-clients do that? Only when they attend one of our events and book a One-On-One session, but no, obviously they can’t call analysts on the phone. That requires buying a Core Research seat. Why is a seat so valuable? In one interaction with an analyst or through reading a small number of documents, what ultimately happens is you will be able to either save your company money, optimize existing processes, shorten project time or ensure you and your colleagues are better informed and, thus, will make better decisions.

seen¬ed Gartner analysts are constantly writing Research Notes on subjects of greatest concern to our clients. Here are excerpts from recent ones that cast new light on a dozen hot topics. Bigger and Better Displays: Productivity Boosters When IT leaders consider investing in updated PC equipment, they are usually driven by factors like upgrades to the Windows operating system, or rising total cost of ownership costs at the end of a life cycle. The displays being used by information workers have not typically been a major consideration. Companies need to change this attitude if they are to benefit from increased productivity … To get the best use out of the human brain’s ability to recognize patterns will require improvements in t he way information is viewed. One key to that progress will be through producing better displays. —Bigger and Better Displays Will Boost Productivity at Last, Mark Raskino, 1 April 2005 Software Architecture: The Rise of the Virtual Network Several trends will drive the future of software architecture. Modularity, service enablement, events, dynamism and reuse are all key factors. However, the movement of complex software into the realm of utility computing will have an even larger effect. The cost of building today’s relatively simple SOAs will be dwarfed by the cost of the complex systems that will eventually be built. This will drive technology providers and end users to experiment with virtual architectures … Virtual networks of services will become a reality by 2010. —Software Architectures Will Evolve From SOA and Events to Service Virtualization, Daryl C. Plummer, 9 March 2005 16 | gartner know-how

Real-World Web: Massive Connectivity Five Years Away The first serious effects of the “real-world Web” will start to be seen within five years. But it will be a decade before mass deployment levels breach key tipping points within social groups and business markets … By 2015, wirelessly networked sensors in everything we own will form a new Web. But it will only be of value if the “terabyte torrent” of data it generates can be collected, analyzed and interpreted. —Extracting Value From the Massively Connected World of 2015, Mark Raskino, Jackie Fenn and Alexander Linden, 1 April 2005 The Linux Desktop: Over-Hyped, for Now The benefits of Linux OS in a desktop environment continue to be over-hyped. Contributing to this misinformation are eight myths that Gartner identified in 2003 (see “Myths of Linux on the Desktop”), as well as two more recent examples that further exaggerate the advantages of deploying Linux on desktops … The hype surrounding Linux may create unrealistic customer expectations; however, companies also need to know the real benefits of desktop Linux and how they can achieve those benefits. —The Myths About Desktop Linux Persist, Michael A. Silver, 1 April 2005

Ultimately, you will be able to guide the strategy and tactics of the organization you work for much better. How do power-users leverage Gartner Research? Many users get Gartner involved just before they have to make a critical decision at the end of a project. In those cases, there’s only so much light we can shine on the subject. Power-users use us throughout the life cycle of a project—for the initial planning, during the project phase, during the implementation phase and, ultimately, during the maintenance and improvement of any project. At all stages, they benefit. What does it take to be a Gartner analyst? We look for the ability to analyze a problem then articulate good advice both verbally and in written form. So [we look for]: thinkers, writers and communicators. A great analyst has a unique way of providing advice to people.

Open Source: Revolutionizing Software Markets Open source software is a catalyst that will restructure the industry, producing higher-quality software at lower cost. It won’t destroy industry giants such as IBM and Microsoft, but it will revolutionize software markets by moving revenue streams to services and support, and away from license fees. —Positions 2005: Open Source Solutions Will Restructure the Software Industry, Mark Driver, 23 February 2005 On-Demand TV: Pulling Ad Dollars Its Way Advertisers will shift significant dollars over the next five years, as large numbers of consumers reveal how they use new technology and as advertising opportunities push new forms past the experimental stage. Many advertisers are already moving away from TV toward media such as broadcast Internet video, but overall dollar impact is small. —On-Demand TV Will Prompt Slow Shift in Ad Spending, Laura Behrens, Denise Garcia and Van Baker, 17 March 2005 Telephony: Voice Service Prices Plunging As broadband access becomes increasingly pervasive, alternative carriers will deliver heavily discounted voice services direct to end users over the broadband connection, bypassing the fixed-line carrier. This is probably the most disruptive threat confronting fixed-line operators today. At stake is the telephony market, which accounts for more than half of a fixed-line carrier’s revenue. —Market Focus: Measuring the Disruptive Impact of Voice Over Broadband (Executive Summary), Puneeth Punja, 31 March 2005 IT Channels: Major Shake Out A rapidly changing market with new buyers and new preferences is altering the IT channel landscape. In five years, there will be fewer suppliers and channel companies, and those that survive will be the ones with a narrow market focus. Application development, outsourcing and business processes represent 75 percent of all services. During the next few years, that’s where all the growth opportunity for channel companies will be … Status quo firms are being bought out, or worse, going out of business, because they are no longer relevant. By 2007, 30 percent of today’s IT channel companies (primarily value-added resellers) will no longer exist. —Market Focus: The Future of the IT Channel, 2005 – 2010, Michael Haines, 25 March 2005

With a great analyst, it doesn’t seem to matter what subject they are actually covering. We have people, like [VP and Gartner Research Fellow] Nick Jones, for example, who started covering application development and then went to Y2K, then the introduction of the euro, and now he’s a specialist in mobile-based applications. The man is brilliant. He knows his stuff, and nobody would think that seven years ago he didn’t know a lot about the mobile-based industry. In a sense, he’s a living metaphor for Gartner Research itself. We have the brain trust. The job is to continually turn it toward the problems our clients face and give them the answers they need—preferably brilliant ones. ■

Personal Firewalls: Wait Personal firewalls are one defense among many that protect against malicious code and attacks that bypass perimeter security. There may be better ways to spend your limited security dollars in 2005 than installing and managing a personal firewall on every desktop, so focus on our top 4 usage tiers. For ubiquitous personal firewall functionality across all tiers of usage, we believe most organizations will wait for converged personal intrusion prevention security platforms—which include personal firewall functionality—to mature and for price points to drop in mid-2006. Until then, you will find a better return on your security investments with improved patch management and distribution capabilities, and network access control technologies. —Desktop Personal Firewalls: When to Buy, When to Wait, Neil MacDonald and John Girard, 25 March 2005 IT Project Failures: Throw It Over the Wall There is still a high failure rate for IT projects because the complexity of business and technology continues to outstrip the ability of technology tools and methodologies to keep pace. At the same time, few firms take pains to integrate IT into their strategies, relying instead on a “throw it over the wall” approach, and that makes it difficult for IT to track the changes in a fluid organization. —What Business Executives Expect From Infrastructure, Jorge Lopez, 22 December 2004 Business Continuity Management: Customize or Fail There is no “one size fits all” when it comes to developing business continuity management strategies and plans. Using someone else’s requirements, which might turn out to be based on limitations or regulations that your company doesn’t have, could spell disaster of another type. —Six Myths About Business Continuity Management and Disaster Recovery, Josh Krischer, Donna Scott and Roberta J. Witty, 16 March 2005 E-Mail: Plan for Disaster Before It Happens Many organizations suffer major e-mail downtime because they wait for disaster to strike before investing in disaster recovery management processes and solutions for short recovery time. Don’t be one of those companies. Many companies have realized that their e-mail systems are vital applications that cannot be down for long after a disaster without incurring serious business consequences. We advise those that have not protected themselves to reduce or minimize the consequences of disaster by creating and implementing a comprehensive disaster recovery plan. Because of the criticality of the e-mail system, and the need to recover in minutes to hours, and not days, we recommend companies evaluate service-provider-based and software-based replication solutions that enable this goal because traditional tape-based recovery approaches will take too long. Further, we advise that you push apathy aside (the “it won’t happen to me” syndrome) and protect yourself before disaster strikes and affects your business. —Build Your Disaster Recovery E-Mail Architecture Before a Crisis Arises, Donna Scott and Robert E. Passmore, 21 March 2005 gartner know-how | 17

trusted advisor Gartner Consulting is the leading independent consultancy at the nexus of technology and business, helping clients manage major technology change initiatives, optimize operations and outsource successfully. We asked Bob Patton, president of Gartner Consulting, about what clients need today, how Gartner Consulting is competitively different and whether clients can expect a high return on their consulting investment.

What are the clients of Gartner Consulting most concerned with today? The context of so many conversations with clients today revolves around three things: extracting the business value from their IT investment, doing more with less and maintaining the competencies they need to achieve their aspirations. Increasingly, clients are coming to us for Critical Program Management. They have a wide array of major technology programs but they don’t have the structure, leadership and methodology in place to manage those programs effectively. Often there just aren’t enough people to devote to the task, or the right skills, and program management is not their core competency. Strategic sourcing is another major line of business for us. Many clients are still unsure about what their sourcing strategy should be, what capabilities they should provide in-house and which ones should be outsourced. We also do a lot of IT optimization. Clients want their infrastructure investment to pay off. We help them optimize that investment. What advantages does Gartner Consulting have over competitors? Gartner Consulting offers what all leading consulting firms must offer: experienced consultants who work with rigorous methodologies, and top-level knowledge management, including best practices. Our edge in our market is also what makes Gartner unique. There is no other consulting company that can bring so many valuable resources to bear on the challenges of technology executives. I’ve been calling it the “Four Cs.” We offer content through Gartner Research that no competitor can provide. We offer community through our Executive Programs, which is the largest CIO membership program of its kind. We offer context through Gartner Events, where senior decision makers from the technology world gather to learn about our latest findings. And with Gartner Consulting, clients are better able to manage change in a technology-and-business environment that is always changing rapidly, and where the stakes are high.

DAN PAGE

What specifically about Gartner Consulting gives your clients an advantage? We are fact-based and knowledge-centric. These are important qualities. With so many consulting firms, it’s the luck of the draw. How smart is the consultant sitting across from you? Sometimes he or she is really smart, and sometimes he or she is not. What’s unique about Gartner Consulting is our direct access to some of the smartest people in the IT world through the Gartner analyst network. Proprietary research, original publications, the very latest facts and figures, Gartner benchmarking data—we have it all at our fingertips. McKinsey doesn’t have it, IBM doesn’t, Accenture doesn’t. And they couldn’t replicate it if they tried. It’s Gartner knowledge-driven insight, and it’s very valuable to our clients as they navigate change and make major strategic decisions. In practical terms, what does Gartner Consulting do for clients that’s so valuable? Clients are always trying to gather data they can assimilate into a higher level of knowledge—unique insights that can be applied for strategic advantage. We bring our clients insights that can make a tremendous difference in the direction they take their gartner know-how | 19

Outsourcing Do’s & Don’ts Five Common Errors

Five Winning Strategies

1. Short-sightedness. Outsourcing is often done as a short-term, moneysaving strategy. Beware. Costs often escalate over the long run. And don’t automatically think the cheapest deal is the best one. It seldom is.

1. Get good advice. Outsourcing is too complicated and risky to do alone. Work with an independent advisor that has lots of experience. It always pays.

2. Sole-sourcing. Enterprises often hand the job over to a familiar service provider without shopping around. Don’t. Vendor prices vary tremendously. 3. Fat RFPs. RFPs are long, tedious documents that force too many candidates to provide too much information that’s really not all that useful. They are a bad habit. Fasttrack with more accurate methods. 4. Dragging it out. When the process takes too long, both parties get exhausted and the deal can suffer. Don’t rush, but set a tight timeline. 5. Cleaning house. Some companies wipe out their IT departments. It’s a big mistake. Good people are needed to run the outsourcing relationship. Keep them and give them an incentive to stay.

2. Start at the end. Most enterprises pick a vendor first, then negotiate a contract and, afterward, manage the deal. First, ask how you want the outsourcing to look, feel and function. Then create a strategy (draw a map). 3. Work together. Companies often negotiate with a service provider as if they are at war. Wars always produce casualties. Commit to the relationship. 4. Measure before and after. Measure performance to prove your operations should be outsourced. If you do a deal, measure performance regularly to ensure you are getting what was promised. 5. Leave openings. Outsourcing deals are often tied down tight in a contract for five to seven years, even 10 years. Leave room to renegotiate based on change, which is inevitable.

businesses, in who they choose to deal with for products and services, in the applications they choose to implement, in the way they refine their organizations to meet the major changes they will have to face. The most significant barrier to change in any organization is trust. Clients also want advice they can trust from a brand they can trust. Skepticism relative to motives is a major headwind to any change that has to be implemented across a wide population. The Gartner brand is based on trust, independence and objectivity. When clients trust, they can accelerate their pace of change. That alone has great value. Where is Gartner Consulting having the greatest impact? Mission-critical program management. Our clients are telling us this is a major problem, and we’re seeing it for ourselves. According to independent research, about two-thirds of our clients’ transformational initiatives fail for a variety of reasons. Largely it’s because they don’t

EXECUTIVE SUMMARY

What about the private sector? A notable example involves a major electronics company that has a new CEO. He plans to decentralize a lot of activities. He wanted a consultant with a trusted brand and a proven methodology that could sit on top of that collection of programs. Gartner will help in a number of ways. If the CEO decides to oversee change from within, we’ve got a framework, a model, methodologies, dashboards, etc. If he wants performance management, we know how to help evaluate performance and predict outcomes. With suppliers, we provide the very latest market research and help clients source and evaluate suppliers. All of this will be brought together by Gartner Consulting in a program management office (PMO) established onsite for managing the elements of transformation: performance, cost, HR, suppliers, customers, contracts, change. What’s the ROI on Critical Program Management? It’s always high for the client. Major initiatives entail major cost and risk. Having someone knowledgeably help control those costs and reduce those risks is quantifiably valuable. Money is saved. Time is saved. Change is accelerated. How has Gartner Consulting changed in the past year to better serve clients? We are much more client-centric. What does that mean? It means we don’t show up once a year before contract renewal and ask if we can be of assistance. We are investing much more time in getting to know the senior people within client firms and doing more advance thinking about their problems—knowing their challenges, increasing our value to them over the long term. Clients want that. They want a single point of contact. They want context. They want continuity. They want us tapped into their strategies so that when a problem arises we can hit the ground running. You mentioned the optimizing of infrastructure being a major client issue these days. What’s the problem? Information technology has long been promised as a strategic differentiator. However, that promise has not been adequately met so IT is under pressure. Business leaders often see it as a cost, not a strategic advantage. That’s why outsourcing is so prevalent. Infrastructure and IT transactions are seen as

Bob Patton

Age 45 Family Married to Cornealia. Children: Rob, 15, and Alexis, 13 Education Bachelor’s in business administration, accounting Position(s) President, Gartner Consulting; CEO, Cap Gemini Government Solutions; managing director, Cap Gemini Americas Company Most Admired Disney Book You Read Most Recently “Rise of Theodore Roosevelt,” Edmund Morris

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have adequate structure, leadership and rigor around program management.

Book You’re Currently Reading “Mission Possible,” Ken Blanchard Recent Movie Seen “The Bourne Supremacy” Major Business Influences Principles of “Good to Great” Major Personal Influences Iron Men, a personal accountability group Favorite Web Site sstcharts.com (critical data for deep sea fishing) Favorite Saying “Consider the interests of others more than your own”

When Gartner Consulting helps organizations optimize their IT infrastructure, the goal is to improve management and structure. This is achieved by first aligning with the goals of the businesses it serves, then moving them forward. You must start with the fundamentals. Stability. The systems and technology must work when they are turned on. Robustness. IT products and services must recover quickly if they go down. Efficiency. IT must operate on budget within predetermined cost limits. Believe it or not, many IT organizations don’t have the fundamentals right. That’s why business leaders so often dismiss IT as an expensive service or commodity. IT groups that have the basics right get less trouble from the lines of business. Those that have optimized their infrastructure tend to enjoy the best relationships with senior business managers.

What Is IT Optimization?

Gartner IT Optimization Methodology There are four essential steps to optimizing any IT organization: benchmarking cost efficiency, assessing process maturity, assessing risk, and aligning IT with the business goals.

BRAD YEO

Step One: Benchmarking Cost Efficiency How efficiently do you use your technology budget? To find out, you have to understand clearly two key metrics: cost and workload/complexity. Cost includes: type and number of specific technologies the company uses, how much it spends on these technologies, how many people IT employs and how much IT employees earn. Workload/complexity includes: Application complexity. Are applications simple desktop software packages or highly tailored and custom-built? Type of services. Is the IT help desk open only Monday through Friday from 9 a.m. to 5 p.m., or does it operate 24/7? Resilience of IT. For example, are the company’s systems extremely robust and able to handle high levels of use? Capturing cost and workload/complexity data—completely and objectively—is critical. In the Gartner experience, a strong correlation exists between the level of workload and complexity in an IT environment and its cost. Without both dimensions, the picture is incomplete. The other vital step: Do a peer comparison. Step Two: Assessing Process Maturity Mature processes combine the right people and tools for a strong, reliable IT function. They enable the efficient delivery of services that meet the expectations of the business units. For each IT process, using standard frameworks, three key aspects are evaluated: Technology. The technology tools used to manage the process. For example, is the process managed by one person with a stand-alone PC and spreadsheet software or by a fully automated system that requires minimal manual intervention? Organization. The number of people working on the process and their responsibilities. How clearly are their roles defined? What are the duties of the process owners? How is accountability measured and ensured? Process. The robustness of the process and how well it is documented.

Step Three: Assessing Risk Business risk and IT risk are assessed in two ways: What will it cost? If applications or parts of the company’s IT infrastructure were disabled for a period of time, what cost would be incurred? Obviously, this varies by industry. If a shipbuilding company’s systems go down for 24 hours, it’s not a catastrophe. If the same thing happens at an investment bank, it could be. Are you prepared? This refers to the company’s disaster recovery plan: how it responds if systems and data go down. Included is the business continuity plan: how the company stays in business during the recovery process. The two must align. If business continuity gets the company through a 24-hour outage but the disaster recovery plan spans 48 hours, there’s an obvious problem. Step Four: Aligning IT With the Business Goals The final step in the process is determining whether the IT budget is being used to produce true business value. Every business has a vision that can be quantified by numbers such as revenue targets, stock price and market share. This vision is supported by an infrastructure—buildings, people, machinery and other assets—that enables the business to achieve the vision. The IT organization develops the applications—like supply chain management software and customer relationship management solutions—that support the business’s infrastructure. Those applications are, in turn, supported by an IT infrastructure of hardware, operating systems, wiring and IT personnel. To determine whether the IT group is developing applications that really are supporting the business infrastructure, Gartner normally has the CIO and other senior executives participate in an interactive workshop. The results are almost always revealing and valuable. The Lean, Mean Machine For IT organizations to drive new value for their businesses, they must first optimize operations. The “machine” must be reliable and efficient at a cost that makes sense to senior management. It must be visibly earning a return on investment. gartner know-how | 21

commodities that should be as cheap as possible, or at least a fixed cost. Concurrently, and largely because of this trend, many CIOs have lost their seat at the executive committee table. So they’re struggling to optimize the cost and the value of IT. What Gartner can do is help those CIOs get back their influence—their seat at the table—by optimizing the transaction costs within their infrastructure and making that infrastructure the agent of business growth. If you were to ask me our primary goal at Gartner Consulting, that would be it: Help the CIO succeed. How can non-clients get a taste of what Gartner Consulting offers without a large financial commitment? An IT optimization assessment is probably the best way. We come in for a couple of weeks and do an overall assessment of the IT environment. We show clients their strengths compared to others in the field and in other industries, and we show them where they need improvement. They get a portfolio of improvement initiatives that can be implemented partially by themselves and partially with our support— keeping in mind that Gartner Consulting doesn’t do hardware or software implementations. We offer advice only. That’s a big part of our value to clients. There’s no vested interest beyond the client’s success. How can existing clients go deeper with Gartner Consulting to get greater benefit from the relationship? Many clients meet with a Gartner consultant and analyst to gather insight, but they often don’t go the next step, which is to make Gartner a critical part of the execution and the management of a solution. I think Gartner is often viewed as a research company that mostly provides information.

With a number of “partner-clients” we are also a trusted advisor. We help them execute and manage important changes on a daily basis. We help clients establish a program management office to put in place the governance required to ensure success of their projects. We help them negotiate their customer and vendor contracts to ensure win-win relationships. We help them implement a sourcing strategy that aligns with the company’s overall vision in the marketplace. We help them transform underperforming organizations into optimized “tools” that drive value through the enterprise. Do your clients earn a high return on their investment in Gartner Consulting? Almost always. And almost always many times over. All of the types of assignments I just mentioned have potentially huge paybacks. In general, when you invest to accelerate change in the right direction, you normally increase revenues or at least efficiencies, which translates into saved costs. Risk management is a big part of what we do. With over 60 percent of all large-scale IT initiatives failing, having Gartner with you for execution and management is like having an insurance policy. Consultants can be accused of insensitivity to bottom-line results. How is Gartner different? Critical thinking and financial analytics run through Gartner Consulting. They are a major part of our training, and we are investing significantly in training. We have also instituted a certification program that requires our consultants to go through multitiered programs in our various competencies, such as engagement management, financial analytics, program management, security, strategic sourcing and benchmarking—all with an eye to the bottom line. Gartner Symposium/ITxpo is focused this time on conquering complexity. How does Gartner Consulting help clients do that? Critical Program Management is certainly in keeping with conquering complexity. It’s all about reducing the complexity of multiple initiatives through a governance structure that takes the “noise” out of the system, creates the synergies and aligns the objectives to achieve results. On a more general level, our job is to bring clarity to clients. Clarity is a weapon against complexity. The clarity we bring to client engagements through research and best practices is a huge advantage when fighting complexity in technology today. ■

Critical Program Management: Aligning for Success Critical Program Management is a growing trend that’s long overdue. With major IT initiatives failing at an alarming rate, qualified third-party program supervision is a small price to pay when the downside is so steep. Gartner Consulting is uniquely qualified to help. One of the more vivid examples of what can happen when a major IT initiative goes wrong is the case of a large manufacturer that decided to implement a new enterprise resource planning (ERP) solution just before an important shipping season. The problem: Employees were not adequately trained. To the horror of the company’s business leaders, there were countless shipping errors, millions lost and a very public embarrassment. The disaster could have been avoided had the company’s IT executives opted for Critical Program Management, a simple concept that can have huge benefits. Usually implemented as a “project office,” Critical Program Management provides formalized, holistic supervision of a crucial project, usually by a third-party expert who oversees all the complexities and ensures that the project not only remains on track from start to finish but also delivers the intended business results. 22 | gartner know-how

Insurance That’s a Bargain Is program supervision a luxury most companies can’t afford? On the contrary, it’s a relatively inexpensive form of insurance that anyone undertaking a major IT initiative probably can’t afford to do without. Consider: • Sixty-six percent of large-scale projects fail to achieve their stated business objectives, are delivered late or are substantially over budget. (Standish Group) • “Through 2008, IS organizations without stringent risk-assessment procedures and mitigation plans will cancel at least 10 percent of all projects initially budgeted at more than $200,000 and at least 20 percent of all projects.” (Gartner Research) • “Through 2008, three out of four successful $500,000+ projects will be planned and tracked with project office support … while three of four failed projects will not.” (Gartner Research) Add the cost of disaster recovery. In the cases of four major enterprises studied by Gartner Research, project reworks cost from 30 percent to 40 percent of total project cost. Compound that by the number of projects that make up the 66 percent that have failed. The risk is real. The cost is potentially enormous. Bigger Programs, Bigger Risks The need for Critical Program Management has grown because the stakes are getting higher. The need to drive business results using IT has elevated investments in

technology. And implementations like CRM and major infrastructure overhauls for e-commerce or real-time supply chain are mission-critical. They can make or break a company’s ability to remain competitive. Gartner is responsible for the upper layer of quality control that such a high level of performance requires. “We’re not really managing the program,” says Ruth Steinberg, managing vice president of the Gartner Critical Program Management practice, “that’s the job of the business sponsor. But he’s not a program manager by training. He’s an executive. He’s the right person to be managing the program but not the right person to be worrying about the individual project schedules or how to get it all done.” Under Water Many executives put in charge of complex IT projects are not trained to manage the vast flow of details. Or they might be experts in one part of the job but not others. A senior finance executive, for example, might be in the best position to ensure the P&L is correct but may fail to see the warning signs of a major logjam in applications programming or operations. Likewise, a technology executive may be a great project manager because he or she knows the technologies and has the project management skills, but might not be equipped to navigate internal politics. Competing priorities also derail enterprise-level initiatives. Multinational companies, multicampus universities and multiagency governments will invariably run into conflicts between the local and “corporate” parts of the whole. “What we provide is visibility when those competing objectives will hurt a program,” says Steinberg. “We make the issues come to light in a politically astute and politically correct way, so that they can be handled and managed and properly accounted for so they don’t stall the program.” Six Proven Ways to Fail There are many reasons a major IT project can fail. According to Gartner, these are the six most common: Fog. No one is clear on the goals and objectives of the initiative. The project crawls along like a ship in an iceberg field, at night, in a fog. Novice in the cockpit. This is the accidental appointee or a first-time program manager, or someone who appears to have the needed skills but really has only some. The missing ones, such as dealing with vendors or controlling costs, might be crucial. Quicksand. Decisions aren’t made. Getting people to sign off is like pulling molars. For example, consultants might help a company design a new data center or a new business process. Everyone agrees at a meeting that it’s a go. The consultant writes up the design. But nobody wants to put his or her name on it. So the consultant is forced to choose between waiting on the client’s signatures or moving forward based on assumptions that may be off track. Quicksand. Premature haste. The deadline is an obsession. All else takes a backseat. This happens frequently in government. A system must be in place before an election or before a certain date. Rushing almost always leads to bad decisions and sloppy work. Cowboy culture. A hot new programming manager or junior executive looking to make his or her mark steps forward and says, “Let me do this. I can handle it.”

The planning is minimal. Teamwork and consensus-building are nonexistent. Success is unlikely. Homelessness. The project has no clear ownership. This happens often with multibusiness unit or multiagency initiatives. With no central authority, the project is led by committee. Big risk. The Objective Eye Why not simply appoint a project office manager from inside the company? “The challenge,” says Steinberg, “is, first, finding program-management skill in-house and, second, ensuring it’s free of conflict or self-interest. Big, complex initiatives are often once-in-a-career-type programs. They include many systems integrators or outsourcing vendors, a blizzard of detail and the continual need to solve problems that bubble to the surface unexpectedly. The needed skills are seldom a core competency found in IT organizations. Half the time, inside people can’t even tell they are in difficulty until it’s too late. And every internal person brings his or her own personal goals and aspirations, and they are limited by their own singular knowledge base. “A third party like Gartner brings fresh eyes and many minds. We bring an independent perspective—independent of the vendors and the client. It’s a necessary neutrality. Our job is to watch the whole program, and we can because of our scale and scope. In fact, no one else in the market can do it the same way. No other consultancy has the breadth of technical knowledge combined with Gartner independence. The strategy firms may have independence but lack the technical depth. The system integrators have the technical capabilities but not the independence. For instance, if you engage one systems integrator to oversee another systems integrator’s project, there’s an inherent conflict of interest. As a competitor, its purpose may be to find fault with the other systems integrator’s work. That’s not our business model. There’s no absolute right or wrong, there is only how to do it better. And to pinpoint the best way to do it better, we have the great advantage of our proprietary database of best practices, our extensive benchmarking and, of course, the unmatched resources of Gartner Research.” Steinberg points out that Gartner never wants to “own” a program or take it over (unless asked). As advisors, Gartner Consulting augments the client team with a team of experts matched to the needs of the program, be it ERP, Web development, data center consolidation, merger integration or any other type of program. “Our goal is not to be the star,” says Steinberg, “but to make a star of the inside project manager.” ROI: Through Every Phase Does Critical Program Management always pay a return? Yes, if you avoid purchasing expensive hardware and software that you don’t need. Yes, if you avoid incurring the thousands spent on reworking applications. Yes, if you avoid wasting six months, like one state government did recently, on an incorrect RFP. Or, yes, if you overlook subtle but profitable efficiencies through every phase of the project, or don’t benchmark your performance once you’ve finished. “Let’s talk about financial management,” says Steinberg. “In the strategy phase of a project, Gartner can help baseline your costs. Over the course of the project, we can track your savings. Imagine you want to consolidate 30 data centers down to six. We can baseline the current costs, help you put the consolidation plan together, oversee the project and manage the vendor that’s doing it, ensuring they stay on track and on budget, implementing the right solutions. We also benchmark performance. If, over the course of the project, you find you are not generating the savings expected, we can work with you to take immediate corrective action. Then we can review performance six months later and one year later to prove that the savings took place. That kind of ‘delivering on promises’ generates massive goodwill with the company’s business leadership, with the customers and with investors.” What does Critical Program Management with Gartner cost? “When we oversee a large program, our fees may range from 1 percent to 5 percent of the total budget,” says Steinberg. “Not a big touch when the savings can be in the multimillions.” Accountability, Visibility, Predictability Critical Program Management is gaining ground fast, particularly in government where cost sensitivity runs high. A number of government organizations at the U.S. state and federal levels have mandated third-party project supervision. But it’s still not common practice in large companies because, as Steinberg says, “people still feel like they can do it themselves—despite the risks. “Our position is that you don’t have to go it alone, and it will almost always pay not to. Bring us in, and we’ll show you the benefits of third-party Critical Program Management: accountability, visibility, predictability, consistency, problems avoided, money saved, ultimate success. Who can argue with that?” gartner know-how | 23

landscape view

Gartner operates dozens of events across the world every year, led by Symposium/ITxpo. These events provide the live view of all the Company’s resources. We asked Alister Christopher, senior vice president of Gartner Events, how our events differ from others and why attendees keep coming back for more.

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What are the priorities of the attendees who come to Gartner events? Three things primarily: 1) Am I evaluating and deploying the right technologies and processes for my business to grow? 2) Am I partnering with the right technology providers to help execute on that? 3) What do I need to know or pay attention to in the near future? Those are the things that seem to rise to the top of the priority list at our events. Attendees come to find the information and technology solutions they need to grow their businesses or better serve their customers. And we try to build an environment and facilitate the right kind of information-exchange forums to allow them to achieve those goals. For example, we partner with leading technology providers as event sponsors, so that attendees can access the information they need from these providers in the most productive way possible. And all events feature attendee/analyst One-on-One sessions, where attendees confer privately with Gartner analysts and consultants on their particular needs. How do you know if you’re successful in meeting attendees’ needs at Gartner events? We measure satisfaction in many ways. At the highest level, the number of attendees at our events has been growing year over year, and our growth is outpacing the rest of the IT events industry, so those are clearly trends that indicate value delivered. At a more granular level, we solicit feedback extensively from our attendees both onsite and post-event through the event evaluation process. At our European gartner know-how | 25

“For any organization considering a relationship with Gartner, there’s simply no better way to evaluate their position than coming to see us in real life. What we deliver at an event is the experience of being a Gartner client.”

What’s the Difference? There are three types of Gartner events: Gartner Symposium/ITxpo, Gartner Technology Summits and Gartner Vision Events. Here are the differences: Gartner Symposium/ITxpo, our flagship event, is held twice a year for six days. Attendees choose from hundreds of sessions that span the depth and breadth of enterprise IT. The conference experience also includes access to ITxpo, an IT solutions and services showcase where delegates meet leading IT solutions providers in a low-hype environment. Gartner Technology Summits are focused on specific topics such as security, wireless technology, outsourcing and more. They include presentations at technology showcases from Gartner analysts and respected keynotes from the leading minds in the IT industry. Gartner Vision Events are highly focused, business-intensive events that bring together leading vendors and senior-level decision makers who attend by invitation. One-on-One meetings are arranged. Gartner advice is provided by attending analysts. The intention is for users and solutions providers to form mutually beneficial strategic partnerships.

EXECUTIVE SUMMARY

What, in addition to Symposium/ITxpo, does Gartner Events offer? We go to market with three very distinct brands. The Symposium/ITxpo series is seven events across five geographies. That’s where people get the most up-to-date Gartner insight across many technology areas. The second brand is our Gartner Technology Summits. Each of these drill-down conferences revolves around a hot topic, so Gartner analysts can delve into more detail on issues we know are of interest to the attendees, such as business intelligence, outsourcing, security, business process management and many others. The third one is our Gartner Vision Events, where we invite technology providers and buyers, and we create an environment where they can do business together in a very informed way. What do attendees take away from Gartner events? We are very contentdriven. We create an environment rich in insight and education based around Gartner’s rigorous, independent research. There’s future-looking content that people want for strategizing. There’s also plenty of practical, real-world content. For example, best practices sessions and case studies are part of every Gartner event. These are the cases of organizations that have used specific technologies for growth and competitive advantage. This is how other companies like you, with the same issues and pressures and goals you have, have leveraged technology in a way that you might find useful. In addition, attendees can bring their own specific challenges and have them addressed one to one with Gartner analysts. Plus, there’s plenty of opportunity to network and exchange information—with other attendees, with Gartner analysts

Alister Christopher

Age 44 Family Married to Karin for 22 years. Children: Joseph, 17, and Caitlin, 13 Education Studied business management at Swansea College Position(s) Gartner: Sales executive; district manager; measurement specialist; vice president, EMEA Sales operations; vice president, inside sales, EMEA; group vice president, inside sales, North America; group vice president, Sales, EMEA; senior vice president, Events Companies Most Admired Southwest Airlines, for putting the client first and having fun doing it. And Starbucks, for getting me through the day!

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Symposium/ITxpo last November in Cannes, by way of example, 96 percent of attendees who returned evaluations said that we either achieved or exceeded their expectations. In addition, members of my leadership team are always onsite at an event to gather feedback from our attendees and sponsors, and we welcome and take action on feedback that comes to us through other channels, such as our analysts and Gartner account executives. Attendee satisfaction is the real pulse of our business, so we never take our finger off of that pulse.

Book You Read Most Recently “Feel: Robbie Williams,” Chris Heath Book You’re Currently Reading “Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant,” W. Chan Kim, Renée Mauborgne Recent Movie Seen “The Terminal” Major Business Influences The people in my organization and profitable revenue growth! Major Personal Influences My family and my father, who gave me two values: Do everything you do with integrity, and show respect to everyone you meet in your life Favorite Saying “You don’t get what you want in life, you get what you expect. So set your expectations high”

Networking or ‘Notworking’? Events like Symposium/ITxpo are promoted as great places to network. But you have to know how. Very few of us are born to it. It’s something you learn through practice. Effective networking is about establishing relationships, not just putting yourself in front of people. Success, at a conference like Symposium/ITxpo, is measured not by how many business cards you hand out but by how many meaningful conversations you have. The goal is to establish mutual benefit and create a seed of trust that you can grow later. Networking is a “soft skill,” and the rules are somewhat flexible (they change, for example, the more senior your position). Here are some valuable tips to practice and some classic faux pas. Be prepared. Networking is a process, not a goal. The first step is to prepare yourself. Review your reasons for attending the conference. Practice how you will introduce yourself to people and the questions you might ask them. Some advisors say you should create a 30-second personal infomercial. And have plenty of business cards on hand. Faux pas: If you forget your cards, forget networking. Be on the ball. Talking to strangers is one of the things people dislike intensely. But there’s some comfort in knowing that almost everyone feels equally uncomfortable. Find someone else who looks like you feel, then break the ice smoothly with something like: “How’s the conference working out for you?” It will be easier from that moment on. Faux pas: hanging out only with people you know.

JOYCE HESSELBERTH | IMAGES.COM

Be impressive. Your body language is vitally important. Be confident but not brash, open but not falsely so. Pronounce your name clearly. Make eye contact. Open your stance. Lean forward to show interest. Nod in agreement to show empathy and understanding. Smile frequently. Faux pas: looking around the room while you are talking to someone. Be interested. Interesting people are interested in others. They are attentive listeners. They put their own agenda aside and focus on their new acquaintance. Listen to the full answer of the other person. Try hard to learn more about them. Offer helpful suggestions. Show interest by asking things like, “What have you liked best so far?” or “Who are you hoping to connect with here?” (Maybe you can help.) Or, “What do you hope to take home from this event?” Faux pas: talking only about yourself.

Be interesting. Don’t bore people with endless shoptalk. Be ready to talk about things in your life that sincerely mean something to you and might inspire personal responses from others—family, sports, new ideas. Keep it light but authentic. Have a point of view. Ask questions that will lead to mutually interesting dialogue: “What do you think are the implications of that session/speech?” “What interesting projects are you working on?” “What is your firm doing about [subject]?” “What do you like most about your work?” Faux pas: controlling the conversation by overwhelming the listener with a barrage of questions. Be sociable. At conference meals, try to sit with people you don’t know, and with different groups at each meal. Take advantage of scheduled social events. They are often a more relaxed place to meet people. Faux pas: hiding in your room. Be generous. Be nice to everyone, not just to those you feel might be useful to you. Think of networking as an opportunity to help the people you meet. Find out what their challenges are and what they hope to accomplish. Tell them what you’ve found out that might be useful. Share the names of contacts you’ve made. Likewise, be clear on what you want to get out of the conference and ask if they have any advice for you. Faux pas: complaining. Know when to walk. Know when to end the conversation and move on. First-time conversations should generally not exceed 10 minutes. Monopolizing someone’s time is bad form. You can always meet up later if the connection warrants it. Be prepared with an elegant exit, such as “I know you’re here to meet new people, so I won’t take up all of your time” or “I enjoyed meeting you.” Or, “Perhaps we’ll see each other after the [event].” Faux pas: clinging to someone past your expiry time. Follow through. Lots of earnest networkers get home and don’t make the time to follow up, so a large stack of business cards just rots on their desk. Make some postconference time on your calendar for follow-up with personalized e-mails or phone calls. One enterprising idea: a well-crafted (unpretentious) e-mail newsletter that is slightly personalized for every contact. By following up, you inch potentially valuable relationships along. Faux pas: mailing a bunch of product collateral with a hastily scribbled note. Remember, networking is about relationships. Go slow. Be genuine. Make friends. Let the benefits flow naturally from the friendships, as they always do. gartner know-how | 27

Gartner has added four new events this year.

Business Process Management Summit 6 – 7 June 2005, Arlington, Virginia, U.S.A. This two-track conference will help business users, application developers and architects understand the business opportunities of BPM. Gartner analysts will discuss the latest technology and best practices for providing rapid response. Sixteen sessions will be led by 12 leading experts and practitioners. Keynotes include MIT professor Tom Malone, process guru Steven Stanton and change management expert Jeff Hiatt. Also included: solutions demonstrations from more than 20 leading BPM vendors.

Financial Services Technology Summit 29 – 31 August 2005, New York, New York, U.S.A. A comprehensive three-day conference for IT executives in the financial services industry and their business counterparts. The focus will be on strategic planning and tactical advice in banking, investments and insurance. Join Gartner analysts, industry experts and technology providers for a highly informative discussion of the state of IT in the financial services industry, a view of the future and what it will take to be prepared.

Energy Utilities IT Summit 26 – 28 September 2005, Austin, Texas, U.S.A.

New in

2005

This summit provides you insight and analysis on the myriad business and technology issues across the entire utility value chain. Both IT and operational executives will benefit from hearing Gartner analysts explore issues ranging from generation to transmission to distribution to retail. Some of the key technology areas featured include CIS/billing and information security, as well as key energy-specific technologies encompassing the arena of utility automation systems, including SCADA, AMR and wireless monitoring.

Enterprise Planning and Architecture Strategies Seminars 14 – 15 June 2005, Cambridge, Massachusetts, U.S.A. 23 – 24 June 2005, Amsterdam, Netherlands 6 – 7 October 2005, Chicago, Illinois, U.S.A. To optimize the overall performance of their enterprise portfolios, business and IT executives in leading organizations are increasingly turning to key management disciplines—such as portfolio management, enterprise strategy and planning, enterprise program management and enterprise architecture—to achieve pervasive business and IT integration. These two-day seminars provide the educational foundation of the enterprise architecture process model and the details for planning and running actionable enterprise architecture initiatives.

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and with leading technology providers. Our goal is to enable attendees to leave our events with a list of actions, confirmations and changes in the direction they are taking with their organizations. How do Gartner events differ from other IT events? No other IT events have the depth and breadth of content that we do. That’s what IT professionals want for their investment of money and days out of the office. The majority of our attendees are time- and budget-constrained now, relative to the late 1990s, and they’re very discriminating and focused about what they want to accomplish at an industry event. And for our sponsor partners, the big, sprawling shows have lost their value proposition because technology providers naturally say, “We don’t want to pay big money and spend time with the undifferentiated masses of people walking past our booth. What we want are business people, decision makers and influencers who we can talk to on a meaningful level.” The Gartner Events model drives exactly that kind of productive interaction. Why is the ITxpo showfloor so subdued? It’s designed that way—to be businesslike. We build the booths for the technology providers so they can’t turn up with elevators to install and glamour girls in short dresses, as happens at other events that allow such things. We ban all that stuff. The priority is information exchange and learning. Our attendees value that. They tell us they appreciate meeting with the technology providers in an uncluttered, low-hype environment.

Symposium/ ITxpo: Six Tips for Doing It Right

1

Get comfortable. Wear comfortable shoes, and layer your clothing.

2

Plan ahead. Spend your first day onsite planning your agenda for the week. Use the Gartner interactive kiosks to build your agenda online using the Agenda Builder Tool.

3

Network online. Use the interactive kiosks to connect with other attendees and access the Internet.

4

Arrive early. Get to popular sessions early to get a good seat, especially at lead presentations.

5

Go one on one. Book your analyst One-onOnes the day you arrive. Some analysts book up fast.

6

Lighten the load. Have your conference materials shipped back to your office by Gartner at no charge.

Do your events differ across the world? You have to look at each of the three brands we talked about. What we’re seeing with Symposium/ITxpo is a very powerful brand. All versions across the world are very healthy. With the Summits, we’re launching eight new events worldwide, either leveraging events we know have done well in one region or launching the same type of event in new geographies. For example, we’re launching a Mobile & Wireless event in EMEA this year, as well as a Data Center event. In Australia, we’re launching a Security event. Hot topics tend to incite demand. How are you changing Gartner events to meet client needs? Content is always changing. While our events are successful, we have to keep them really fresh and really focused on the hottest issues. To do that, we work in very close collaboration with Gartner Research. Every one of our events has an event chair and co-chair who is actually a Gartner analyst. They help us build the content and the focus. What about Gartner Executive Programs? How does it fit with your events? I think last fall in Orlando we had more than 700 CIOs at Symposium/ ITxpo, which is probably the largest single gathering of CIOs in the industry. Many of them are members of Gartner Executive Programs. Our events are a place to not only learn from Gartner analysts and consultants but to meet and confer with peers—your community within the larger community of Symposium/ITxpo attendees. We’ve also created something unique at Symposium/ITxpo for our loyal public sector folks. At the Orlando event, we create a community within a community for them that features a designated area to gather and network, and breakfast briefings focused on their issues. It seems to work very well for our public sector delegates.

ROBERT NEUBECKER

One of the key selling points of Symposium/ITxpo and other Gartner events is that they allow attendees to escape the mad rush of their daily business lives. How important is that? That’s a big point. When people make a conscious decision to take five days out of the office, they have the freedom to sit back, draw a breath and think about things in a different way. To be able to push your thinking forward like that isn’t a luxury, it’s a necessity that too few professionals in busy work environments allow themselves. Is Symposium/ITxpo a good way for IT people who are not Gartner clients to taste and feel what Gartner has to offer? For any organization considering a relationship with Gartner, there’s simply no better way to evaluate their position than coming to see us in real life. What we deliver at an event is the experience of being a Gartner client. You get access to the intellectual property and the advice and the guidance. You get a good opportunity to find out if this is the kind of company you want to be involved with. Many people just read our reports. Coming to a Gartner event gives you the amazing depth and prowess behind the reports. It’s where everything comes alive. ■

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CIOs have perhaps the loneliest job in senior management. They are often misunderstood by their peers. They bear the full weight of high expectations around the ever-changing technology systems that drive business today.

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tailor-made insight Gartner Executive Programs exists to lift this weight and help CIOs lead their teams and collaborate with their business colleagues more effectively. In this interview, Terry Waters, senior vice president of Gartner Executive Programs, explains why his group has become the world’s largest CIO membership organization and the fastest-growing Gartner business. gartner know-how | 31

exp cio signature is an exclusive membership program for the most senior IT executives at the world’s largest enterprises. Designed to enhance CIO productivity and professional development, CIO Signature offers highly customized membership privileges, access to strategic research and true peer-group networking. Membership in CIO Signature is reserved for senior IT executives who meet all membership criteria. exp premier is a preferential membership program for top IT executives. The program offers CIOs of medium-to-large public and private enterprises preferred access to Gartner and the opportunity to network with a diverse group of CIOs who share similar issues and challenges. best practices councils are offered in North America and Europe to senior functional IT leaders who report to the CIO. The Councils combine case profile analysis with best practices research and facilitated peer-to-peer exchanges. cio academy is professional development at the highest level, designed for CIOs and direct reports. Removed from the tactical concerns of the workplace, participants focus on strategic change management, personal productivity and the critical alignment of technology and business. The learning is highly personal and satisfyingly practical, customized to the needs of each participant. The goals are for participants to share their challenges, elevate their thinking and return to their enterprises with a renewed perspective and tailored action plan for success.

EXECUTIVE SUMMARY

What’s the value proposition of Gartner Executive Programs? The mission of Gartner Executive Programs is to be the indispensable partner and advisor to CIOs and senior IT executives on every important technology and technology-enabled business decision. CIOs in large corporations and government agencies have immense responsibility and few road maps for solving complex management and technology challenges. Through an Executive Programs membership, Gartner research and advice are tailored specifically to each member’s issues and challenges, and our network of more than 3,000 executives makes it possible for us to facilitate valuable connections between members for mutual counsel. Gartner Executive Programs enables CIOs in leading enterprises to solve complex business problems, provides members with exclusive research written specifically to their issues and prepares CIOs to bridge the gap between technology initiatives and business results. What are the membership options in Executive Programs? There are three membership options. Gartner EXP CIO Signature is tailor-made for the CIO of a large corporation and is a very personalized service. Signature program managers are former CIOs who provide trusted advice to CIO members. EXP Premier is for CIOs dealing more with operational issues and looking for answers and preferential access to Gartner research experts. The program is focused on Global 4000 and government agency CIOs and CTOs, and provides a combination of member-driven research, community-based peer exchange and expert advice. Gartner Best Practices Councils provide a combination of case study-based content and topically based peer exchange for senior IT executives reporting directly to the CIO, such as heads of architecture, security and sourcing. At all levels, Gartner Executive Programs is focused on the success of the individual members, their teams and how they can contribute to the success of their enterprise. What is the ROI of Gartner Executive Programs for its members? First, our members are able to make smarter decisions more rapidly around complex IT and business management issues by using Gartner expertise, case studies and peer advice. We save them time and money by facilitating access to the resources they need when they need them. Peer counsel is especially valuable. We constantly have members come to us and say, “I need to talk to another member who’s gone through this before.” We can usually connect them not only with another member, but with someone from an organization of similar size and complexity with a similar issue. They get very relevant information and advice, very quickly, from a peer. Second, they can quickly access the Gartner worldwide research engine of tenured analysts and subject-matter experts. We can put them in touch with an expert who can cast a bright light on a particular issue. We can also provide them access to vast databases of content that can help them make the best possible decisions for their enterprise. A third way Executive Programs helps members receive value is through coaching and professional development. Our program directors in CIO Signature, who are exCIOs themselves, have walked in the same shoes as our members and can work with

Terry Waters

Age 46 Education Bachelor of arts, College of the Holy Cross

Book You’re Currently Reading “Good to Great: Why Some Companies Make the Leap ... and Others Don’t,” Jim Collins

Position(s) Gartner: senior vice president and general manager, Executive Programs; senior vice president, Best Practices; senior vice president, IT Executive Programs; vice president, Worldwide Marketing; regional vice president, Sales; Screaming Media: chief operating officer; Xerox: product specialist

Recent Movies Seen “Ray, ” “Friday Night Lights,” “Mystic River,” “Man on Fire”

Companies Most Admired General Electric, Goldman Sachs, Microsoft, McKinsey, Bloomberg

Favorite Web Sites wsj.com, yahoo.com, forbes.com

Book You Read Most Recently “Undaunted Courage: Meriwether Lewis, Thomas Jefferson and the Opening of the American West,” Stephen Ambrose

Favorite Saying “What would you attempt to do if you knew you could not fail?”

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Major Business Influences Peter Drucker, Xerox SPIN sales training, Jack Welch, Gideon Gartner Major Personal Influences Family, friends, the Jesuits at Holy Cross, Boy Scouts of America

them one on one to advise them on their most pressing issues. Membership in Executive Programs is geared toward enabling members to make the best possible decisions in a rapidly changing environment. We make it easy for members to leverage all aspects of the program: member-driven content, peer networking and expert advice tailored to their unique needs. What separates Gartner Executive Programs from other similar programs? There are three things that differentiate us substantially from any of our competitors. One: the Gartner research engine, which includes more than 1,000 subject experts, including Gartner analysts and consultants, with more than 10,000 collective years of experience. Two: the largest CIO network in the world, with more than 3,000 members actively participating. And three: the 210 professionals within Executive Programs who have more than 1,000 collective years of experience advising CIOs and senior IT executives around the world. All three of those considerable advantages are brought to bear for the personal benefit of each individual member. That’s a powerful and distinct value proposition that all of our members benefit from when they need it. So there’s nothing similar in the marketplace? No. One similar program is about one-third our size, but they only provide some of the value via case studies from the membership and peer networking. We bring so much more to the table: Gartner expertise and depth of content, including frameworks, templates and case studies; the size of our member network; our dedicated team of professionals; and our program management that ensures outstanding relationship management for all our members. Executive Programs almost sounds like an inexpensive form of consulting. Gartner Executive Programs brings together a unique blend of capabilities to deliver real value for our members. Each program is a hybrid of member-driven multiclient studies, expert advice and peer exchange. We are delivering specialized advice syndicated

“Our members are able to make smarter decisions more rapidly around complex IT and business management issues by using Gartner expertise, case studies and peer advice.”

across our membership in the same way a management consultant might bring advice to a select group of clients or an individual client. Executive Programs is one of the fastest growing units at Gartner. Why? The service is authentically valuable, the convenience appeals to timepressed members and the content is extremely relevant because it’s member-driven. Our members tell us their issues, and we put our team of 210 professionals to work to help them maximize the ROI from their membership. Our member-driven process comes to life most vividly in our annual CIO survey. Done at the end of every year, it sets our research agenda and program delivery for the following year. This past year, more than 1,300 CIOs gave us input about their major business initiatives, management challenges and technology programs. We’ve taken that input … and our goal is to deliver fresh insight and advice by industry sector, by business segment and by geography to each individual member over the course of 2005. What were the key issues cited for 2005? The top three issues cited were delivering projects that enable business growth, linking business and IT strategies and plans, and demonstrating the business value of IT. CIOs want to get more involved with corporate strategy, rather than be the head of a service function that simply implements strategy. How does Gartner Executive Programs help them do that? What we do is help align what CIOs are trying to do in the context of what their business is asking them to do. There is great focus on projects tied to business growth. Our job is to support a CIO to be successful personally, with his or her team, and with his or her key business stakeholders. Part of this mission is to deliver insight on how the CIO can best work with peers and build a better relationship with the CEO. CIOs are involved in, and in some cases driving, some aspects of corporate strategy. More and more, IT is woven into the fabric of business operations. With this said, we have observed that some CIOs are losing their footing in the senior leadership teams of big companies. However, this depends on the industry, sector and size of the company. Generally, we’ve found that many CIOs did, indeed, lose some ground with regards to being involved in corporate strategy, post-bubble. In the past 18 months, CIOs have been regaining ground, as enterprises have been upgrading their infrastructure and trying to move toward important IT-enabled strategies, such as real-time enterprise and business process fusion, which are technology-dependent and very strategic. We continue to see an interesting demographic shift: About half of the CIOs being hired and/or promoted into the role are coming out of the business side of the enterprise vs. rising up through the traditional IT ranks. This is significant and should help with aligning business and IT strategy in the years ahead. The CIO has a lonely job. It can be very lonely. In a profession where the demands are high, changes are constant, yet understanding of IT’s complexity within other parts of the enterprise is fairly low, we offer muchneeded support, advice and connection. While all CIOs have their own personal network, through Gartner Executive Programs members have access to a much wider network. Through their membership, CIOs are gartner know-how | 33

always in touch with what other CIO members are doing. They have a sounding board for their ideas—an insurance policy to support the risky environment they live in every day. Even the CIO who doesn’t want to directly connect with peers benefits from the network through our research agenda and access to Gartner analyst expertise. We are constantly mining the network, our content and the Gartner analysts for new insights for the benefit of all our members. Is there a way for nonmembers to sample the power of Executive Programs prior to joining? Absolutely. We produce executive summaries of our research publications, and we’re happy to share those with prospective members. We also run events for qualified prospects in major metropolitan areas around the world, as well as at our major conferences. And after we’ve met with a prospective member, if appropriate, we do our best to connect him or her to members in the network. He or she can talk openly to a peer who can explain the benefits of a program membership. Finally, we often get prospective members working one on one on a specific issue with a program director. This way they can see the benefit of our program team at work.

Conquering complexity: How, through Executive Programs, are your members able to do that well? As I said at the beginning of this interview, CIOs in large corporations and government agencies have immense responsibility and few road maps for solving complex management and technology challenges. Through an Executive Programs membership, Gartner research and advice are tailored specifically to each member’s issues and challenges, and our network of more than 3,000 executives makes it possible for us to facilitate valuable connections between members for mutual counsel. Gartner Executive Programs enables CIOs in leading enterprises to solve complex business problems, provides members with exclusive research written specifically to their issues and prepares CIOs to bridge the gap between technology initiatives and business results. We make sure that we bring the best of Gartner to each member’s particular issue—very tailored, personalized and easy to use. We work with our members the way they want to work with us. We work very hard to provide a combination of content, advice and connections to add value and help them move more quickly toward making the right decisions for their enterprise. That sounds like conquering complexity to me. ■ 34 | gartner know-how

Gartner CIO Survey: The Big Picture For the past five years, Gartner EXP has annually surveyed CIOs from every continent to discover their behaviors and beliefs. It’s the largest survey of its kind. More than 1,300 CIOs participated in this year’s survey. The result is the “CIO Agenda,” an annual EXP report. These are some of the key questions answered in Delivering IT’s Contribution: The 2005 CIO Agenda: What are the forces shaping the business and technical context for 2005? What are the priorities for CIOs in 2005? Where are CIOs investing their budgets and management attention? What are the practices of performing CIOs? How does an individual CIO stack up against CIOs overall? Their industry peers? CIOs in their geography? Here are some highlights: Budgets Up After Four-Year Slump 2005 will be the first year of a marked growth of computing expenses since 2001, the burst of the Internet bubble and the beginning of cost reductions in most companies. Today’s priority lies in the reinforcement of computing security systems. Spending for Growth CIOs have changed their spending focus from projects that help control costs to those that can help grow their business. Think security enhancement tools and business intelligence software, for starters. IT’s Business Contribution Increasing CIOs have become more central in helping companies meet growth expectations, and IT investments are now targeted at areas that drive profitability, such as re-engineering business processes from a customer perspective. This trend will continue through 2008, as companies strive to find new ways to stimulate growth. A Need for Talent Staffing: CIOs cite staffing as a challenge in meeting new IT goals. Just 39 percent of CIOs surveyed said that they currently have the right people to meet present and future business demands. Security Still a Priority Security issues such as viruses, hacking and malicious use of information have not gone away. At the same time, new regulations such as Sarbanes-Oxley mean that information security is a major priority. Top 5 Trends Impacting the Enterprise, According to CIOs 1. Business process improvement 2. Security breaches and disruptions 3. Enterprisewide operating systems 4. Supporting competitive advantage 5. Data protection and privacy

JAMES YANG | IMAGES.COM

What about existing members? How can they better leverage your services? The biggest opportunity lies within the network: facilitated networking with other executives around the world, attending our events to meet with peers, learning from other members, as well as learning from Gartner experts. Also, CIOs are increasingly looking for us to help them with their IT leadership teams—to develop their agenda, to strengthen their management bench, to move the entire team forward in unison. Finally, we believe we can help our CIO members tighten their alignment with key business stakeholders, such as the CFO, COO and CEO, by providing them with the tools and techniques for communicating the value of IT.

[ essential reading ] CIOs at the Crossroads

ROB DAY | IMAGES.COM

The role of the CIO is inevitably changing due to two perspectives on information technology, according to Ellen Kitzis, group vice president product management, Research Business Development, and Marianne Broadbent, senior vice president and Gartner Fellow, Global Research Business Strategy. On the one hand, there is the lingering disaffection with IT from the Internet bust, the technology capital spending overhang, popular press stating that IT is now irrelevant in competitive advantage discussions and hysteria about IT jobs moving overseas. On the other hand, the global economy seems to be finally escaping the doldrums, business executives are desperate for innovation, the regulatory environment has put far more emphasis on the timeliness, completeness and accuracy of corporate information, and technology is playing a foundational, if not a central, role in virtually every product and service.

Broadbent says that for today’s CIOs, standing still is not an option: “Every CIO will follow one of two paths based on these perspectives. The path influenced by the view that sees IT as a commodity with no differentiation in use lays the foundation for a role that might be called ‘chief technology mechanic.’ The other path, influenced by the view that sees information and technology as the heart of every significant business process and crucial to innovation and enterprise success, leads to a role we call ‘the new CIO leader’; it’s a role with all the prestige, respect and responsibility of other senior executive positions. It’s up to CIOs to help construct that path.” Broadbent’s and Kitzis’s perspective is laid out in their book, “The New CIO Leader: Setting the Agenda and Delivering Results,” from Harvard Business School Press. Kitzis notes that the difference between the two paths, between chief technology mechanics and new CIO leaders, is very simple: “It’s all about leadership. Most CIOs today are excellent managers, but relatively few have stepped up to become leaders, true enterprise leaders. And there is a crucial difference between leadership and management.” Leadership is about change, doing new and different things. Management is about executing well on the things you’re already doing. And if ever there was a time for IT organizations and CIOs to think about doing new and different things, it’s now, says Kitzis. CIOs need to become enterprise leaders both on the demand-side and supply-side of IT, the authors say. Broadbent explains, “There are really two aspects of leading when you’re a CIO. First, you have to lead with your business colleagues to determine what are the appropriate uses and applications of technology in the enterprise. This is primarily about setting real and appropriate expectations for how technology can help the enterprise reach its goals. It’s what we call the demand-side of IT. The supply-side involves leading the IT group to deliver on the expectations of the business.” Broadbent also notes that leadership in both of these areas is crucial for enterprise success and crucial for the career prospects of any current CIO: “Enterprises desperately need this leadership from CIOs now. And they will find it, if not from their current CIO then from whomever they hire as a replacement.” In “The New CIO Leader,” the authors introduce 10 critical points—divided into demand-side and supply-side issues—that distinguish new CIO leaders. These 10 points differentiate CIOs who will be enterprise leaders from those who won’t. CIOs’ priorities among the top 10 will vary by their current situation, Kitzis says. “Enterprises that are rapidly growing want their CIOs to focus on having a compelling vision for how IT can help them continue to grow and succeed. Enterprises that are struggling need CIOs to focus on building a better and leaner IT team. All CIOs who want to be leaders, though, have to make knowing their enterprise inside and out a top priority.” gartner know-how | 35

our story thus far ... “Multisourcing: Moving Beyond Outsourcing to Achieve Agility and Growth,” by Linda Cohen and Allie Young A new approach to a timely business issue from leading experts in the field. Multisourcing presents a road map managers can follow to move beyond simply outsourcing and position their firms as tomorrow’s industry leaders. Harvard Business School Press, Fall 2005 “The New CIO Leader: Setting the Agenda and Delivering Results,” by Marianne Broadbent and Ellen Kitzis Mandatory reading for CIOs everywhere, “The New CIO Leader” spells out how IT can deliver results that matter, and how CIOs can become the enterprise leaders they should be. Harvard Business School Press, 2004 “Heads Up: How to Anticipate Business Surprises and Seize Opportunities First,” by Ken McGee Real-time information will transform the business world, and every manager has the power to make it happen. Offering insights and tools that enable informed decision making, “Heads Up” drives out uncertainty and ushers in real-time opportunity. Harvard Business School Press, 2004 “Achieving Business Value From Technology: A Practical Guide for Today’s Executive,” by Tony Murphy Murphy offers proven techniques, methodologies, governance mechanisms and best practices guidelines to guarantee that your technology investments yield real business value every time. Wiley and Sons, 2002 “World Without Secrets: Business Crime and Privacy in the Age of Ubiquitous Computing,” by Richard Hunter Learn how to protect your business from information crime, seize emerging opportunities and survive and succeed in a new environment that is as dangerous as it is promising. Wiley and Sons, 2002 For more information about Gartner books, visit gartnerpress.com.

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[ essential reading ] The Real-Time Enterprise: Detection, Not Response

JOYCE HESSELBERTH

Gartner Fellow Ken McGee is a man on a mission—a mission to change the way business executives and their IT peers look at real-time data. “Far too many people think of responses as soon as they hear the words ‘real time,’ ” says McGee, “but the Real-Time Enterprise is about real-time detection, not real-time response.” According to McGee, his realization of the importance of detection vs. response came about after years of research. “I had always been troubled by the emphasis on responses, having seen many companies suffer from overreactions to market changes or competitor actions. It was only after studying dozens of disasters, both in the natural world and in the business world, that I realized the core of the problem,” he says.

McGee details his research on the Real-Time Enterprise and the implications for businesses in his book, “Heads Up: How to Anticipate Business Surprises and Seize Opportunities First,” published by Harvard Business School Press. Recently, Gartner Know-how had the opportunity to discuss the book, and reactions to it, with McGee. “My intensive research started in 1999 but took off in earnest after the 2000 stock market crash,” McGee says. “At that time I wondered, ‘How is it possible to have so much wealth destroyed so quickly?’ Even with all the real-time stock-market-watching tools, millions of people lost more money than they dreamed possible. The issue wasn’t that they couldn’t respond fast enough, it was that they didn’t know they needed to respond until it was too late. That’s when I really started to look at other examples, first natural or man-made disasters like the Zeebrugge, the Belgium ferry disaster, the Mount St. Helens eruption, the Challenger explosion and so forth, and then at business disasters like MCI , WorldCom and Enron. A very clear pattern emerged. “In every case … there was warning before the disaster occurred—just like in the stock market crash. The evidence, the pattern, was overwhelming; before every disaster I could find, there was always warning.” According to McGee, the consistent presence of early warning is what drives the need for businesses to focus on detection instead of responses. “If you can detect that the market is changing, that sales volumes are not being met, that costs are running over budget in real time, that gives you the ability to respond at the right time, with a well-planned and appropriate strategy. If, however, you focus on real-time response, you’ll always miss the best opportunities for a positive response to changing market conditions.” If there is warning before all business mishaps or disasters, why do they still happen so often? There are several reasons, but the primary reasons have to do with timeliness and availability of information. In many of the cases I researched, the information that would have provided warning was not being captured in real time (and in many cases, not being captured at all), and therefore the warning was received too late. By the way, what exactly is a Real-Time Enterprise? In the book I define a Real-Time Enterprise as one that practices real-time detection in all its critical business processes. Additionally, a Real-Time Enterprise further improves its performance by redesigning all processes needed to respond more efficiently and effectively when required. So there is a role for faster responses? Absolutely. Businesses need to take unnecessary delays out of their responses, but that is very different than responding in real time. You might say the goal is real-time detection, right-time response. Are there Real-Time Enterprises out there right now? Right now, I don’t believe there are true Real-Time Enterprises, but they are coming. As we speak there are an ever-growing number of companies using real-time information to avoid surprises and seize opportunities. The CEO of GM tracks sales in real time, for instance. Retailers like Wet Seal are using real-time sales information to more effectively allocate inventory. Amberwood Homes has raised its margins at least 10 percent by gathering real-time information on subcontractors’ efforts. eBay is using real-time information to keep offensive material out of its auctions. So RTEs are coming, and they are coming fast. gartner know-how | 37

Gartner Consulting, staffed by nearly 600 specialist consultants, is hired to help business and government clients solve problems and stimulate growth through IT. Gartner Research, with more than 600 analysts, is the rich source of our independent viewpoints and market data. Here are three client case studies of recent Gartner work in both Consulting and Research where good advice and independent data led to strong results.

The Value of Optimization A major Silicon Valley software firm helps IT executives boost performance, business impact and customer satisfaction with solutions that manage IT infrastructure, governance and the entire application life cycle. Today the company’s global reach and $700 million revenues make it one of the fastest growing, most respected, enterprise software companies in the world. The firm’s management team depends on Gartner to assure it sustains market leadership. Challenge The firm’s aim is to help CIOs run IT like a business, using principles of supply-and-demand management to optimize technology investments. No company wants to over-invest in technology, nor does it want to come up short. By using this firm’s solutions, CIOs find the right balance, especially in high-budget categories like infrastructure, governance and application development. Like any technology company, the firm is challenged with growth, assessing emerging markets such as China and India, evaluating potential acquisitions and growing new partners and alliances. Approach Insight. Gartner analysts advise the firm on strategic planning, keeping product development and marketing professionals ahead of the curve in an exceptionally competitive market. Market awareness. Gartner helps the company build awareness through marketplace events, online webinars and inclusion of Gartner insight in its promotional materials. Customer segmentation. Gartner research and advice helps the firm’s marketing staff fine-tune their segmentation strategy. Such fine-tuning helps the firm promote its solutions to the customer segments most likely to respond to its marketing campaigns. “Gartner is a trusted advisor because they are respected and well-connected with the IT user community. We consult our key Gartner analyst before making any major moves.” —Chief Marketing Officer, Software Company

Results Brand excellence. Gartner has helped the company build and establish its brand, propelling the company from a point product solution to a full-scale, enterprisewide solution. Growth. Gartner analysts have been advising the client for five years. Since then, the company’s market presence has expanded into global markets. The brand has been strengthened and revenues have steadily increased on average by 20 percent each year. Buyer insight. With Gartner, the firm has improved its knowledge and insight about the needs of IT buyers for its products and solutions. The results have also helped it develop and grow a best-in-class marketing organization. 38 | gartner know-how

True Value

[ making the case ] The Value of Benchmarking

The Value of Outsourcing

For the past four years, Entergy has entrusted Gartner to help it benchmark pricing and other key performance indicators of its multimillion-dollar outsourcing arrangement. The relationship has paid off in a big way, keeping Entergy’s IT performance metrics in the top 25 percent of its peer group. Entergy’s managers also benchmark the firm’s IT practices against those in the industry to keep it abreast of other opportunities to add value to the business.

When organizations look to outsourcing as a strategy to reduce costs, the emotional response can run high. The challenge is even tougher in city government environments where the interests of local politicians and labor unions must be delicately managed. When the City of Minneapolis, Minnesota, U.S.A., faced such a situation, Gartner consultants were called upon to support the city in validating a business case for outsourcing, as well as evaluating external service providers.

Challenge

Challenge

Every firm that decides to outsource major IT operations needs an external perspective on vendor relationship management, cost control and, in many cases, migrating to a performance-based billing model. Since Entergy conducted a full outsource of all IT operations, it has been continually challenged with ensuring it is getting full value for its outsourcing investment.

City of Minneapolis CIO Karl Kaiser was looking to guide his organization with technology strategies that would advance business objectives, optimize costs and drive higher customer satisfaction. Outsourcing was an obvious strategy for cost reduction, but would it compromise existing service levels and relationships with local labor unions? Would local politicians find outsourcing a threat to their constituents? Could the city attract top vendors?

“In IT, measurement is high-priority because of outsourcing.”

Approach

—Vicki Langley, Director, IT Sourcing and Performance Management, Entergy

Approach Relationship assessment. Gartner delivered a relationship performance assessment to find opportunities for performance improvement. Benchmarking. Entergy’s IT managers engage Gartner each year to benchmark vendor pricing and other key performance indicators to assure they are receiving optimal value from a multimillion-dollar outsourcing arrangement. Best practices review. Entergy’s benchmarking efforts also include a review of current industry best practices to reveal even more opportunities for boosting efficiency and performance. Results High performance. Entergy’s IT performance has remained in the top 25 percent of its peer group for the past four years. Optimum value. Gartner helps Entergy leverage industry metrics to ensure it is getting optimum value for its outsourcing investment. Best practices. Entergy continually adopts best practices revealed through benchmarking to reduce costs and keep morale high.

KEN ORVIDAS

Relationship management. The annual benchmark also involves Entergy’s service provider, which contributes to keeping a positive, productive relationship in place.

Existing work validated. The Gartner team started by validating the work the city had already completed. The team also analyzed best practices being used in local government and other outsourcing situations of similar complexity. Business case and evaluation and selection support. Gartner supported the city’s efforts to build a business case that demonstrated the financial and strategic argument for outsourcing. In addition, Gartner provided third-party objective analysis of vendor proposals to assist in the city’s evaluation and selection process. Objective analysis. Gartner independent, objective analysis was instrumental in supporting the arguments needed for the Minneapolis City Council approval process. “We were very close to the situation on many levels. Gartner provided an external sanity check on the entire deal.” —Karl Kaiser, CIO, City of Minneapolis

Results Consensus. Approval to outsource was secured from a diverse group of stakeholders, including 12 of the 13 members of the Minneapolis City Council. In addition, selection of the external service provider was validated using industry best practices. Validated procurement scope. The city’s plan to migrate computer and network infrastructure, various support functions and the help desk to an external service provider was validated through an independent, third-party review. Application development remained in-house. Outsourcing contract closed. The City of Minneapolis signed a seven-year, $54 million outsourcing deal. gartner know-how | 39

[ talent pool ]

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What Does It Take to Be a Gartner Analyst? Take in everything. Give back the best parts. “Exceptional ability to absorb extremely large volumes of disconnected and unrelated pieces of data, organize it into something cohesive, see the big picture and, at the same time, focus on the details. Then distilling it into bite-size pieces of analysis, information, insight and recommendations. Then defending it among your peers. That’s the name of the game.” —Craig Baty, Research Analyst Do it all. And research, too. “Responsiveness, availability, visibility—all are key. This is the most difficult job because you are bombarded with requests from all angles. Customers come first, peers second. You have to force time to do research and subsequently get it published. Writing is the key to leveraging our research, and leverage is critical to the Gartner business model. Our job is to make sure the thought leadership, collaboration, customer service and responsiveness we all strive for doesn’t keep us from doing the research and publishing. No one can use what’s stuck in your brain.” —Yvonne Genovese, Research Analyst

Maintain a global view. “In addition to writing research, Gartner analysts spend a significant amount of time in front of clients, and our clients are spread out across the world. To be successful, an analyst needs to have a good understanding of the diversity of our client population, which includes every background, location and language. Our analysts understand their clients, where the clients come from and what the clients need to drive their business strategy. Our analysts have the ability to make the complex simple and relevant, regardless of location. They maintain a true global reach.” —Alissa Stayn, Human Resources Director Stand firm. And know when to let go. “I think there’s a secret recipe with the right mix of ego and humility. A good analyst has to have a passion for his or her positions and a belief that he or she can make a difference, but also has to be willingly prepared to change position. You cannot defend a position to your dying breath. Hopefully, you can either admit you are wrong and move on, or get ahead of the curve of everybody else and change a position when warranted.” —Mike Chuba, Research Analyst

CATHY GENDRON

We asked three analysts and an HR director that question. The short answer is: the ability to think, write, converse, travel, speak to large groups and stay on top of your topic at an unrelenting pace that would exhaust mere mortals in no time.

Gartner Consulting.

Harnessing the Power of IT. Many initiatives are quick to start, but elude the peak. It’s typically easier to start IT initiatives than it is to finish them. Just when the mountaintop is in sight, it can suddenly feel you’re that much further from reaching the top. And with so many business initiatives vying for resources, some of them inevitably start to fall. So how can you do a better job of setting priorities, managing resources and assuring all your IT initiatives reach the summit—with the results the business expects? Get Gartner Consulting involved. With 2,000 projects a year, we have the experience and know-how that keeps IT initiatives focused on desired business outcomes. Our methodology helps you set goals and priorities, make key technology choices that enable the business and simplify your environment, select the right vendors and manage the most critical initiatives— with complete objectivity and independence. And, we help you tie it all together with a consistent quality standard. We are the mountaineers that give you the boost you need.

To learn how Gartner Consulting can help you push IT initiatives to the top, visit gartner.com/consulting. RESEARCH

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Real insight. Real impact. Today. Every day, you face tough decisions. Any one of them can change your future. One right move can produce record growth. One wrong move can cause your customers to go elsewhere. With Gartner at your side, you can make these decisions armed with the best insight available. In doing so, you’ll be backed by the experience and expertise of our 600 analysts—all of whom are experts in their chosen fields. With our research, you’ll get the intelligence you need on which vendors are right for you, cost-of-ownership, forecasts of market demand, and even our predictions for the future. And you’ll get it based on our proven methodologies that push through market hype to get to the facts. It’s all at your fingertips: research, interaction with our analysts, and more.

See for yourself why 45,000 clients across 10,000 organizations rely on us every day. Visit us at gartner.com.

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