The New Year is a time for taking stock. For most IT managers that should be more enjoyable than in the past. After years of cutbacks, outsourcing and boardroom bust-ups, the chilly winds of retrenchment are giving way to the balmy breezes of expansion.
Salary rises raced ahead of inflation at an average of five per cent last year, according to the National Computing Centre's latest survey.
If you work in London you can expect an average of u40,000 a year, or u31,500 if you work further north.
As usual, those in the financial sector pocket more than anyone else - an average of u40,000 - with managers in engineering and the public sector at the bottom of the pile. They earn u31,800 and u32,000 respectively.
Not only are IT managers paid more, but they have more to do. With the desktop revolution, responsibilities were devolved from the centre to specialist units or to outsourcing companies. However, recent developments are reversing that trend. The hot technologies of the 1990s - data warehousing, electronic commerce, the Internet and intranets - are networked developments that involve systems throughout an organisation and which call for central co-ordination.
Existing systems are also due for an overhaul. There will be plenty for IT managers to do in dealing with, not only the year 2000 date change, but also the advent of European Monetary Union and its requirement for working in dual currencies.
The main headache will be finding people who have the skills to implement these new systems. The Institute of Data Processing Management (IDPM) warns that skills shortages have reached crisis level, particularly for C++, Oracle and Windows NT applications.
But the good news from the IDPM is that there has been a 70 per cent increase in the number of adverts in the national and specialist press for experienced managers. However, companies are looking for well-rounded individuals who can contribute to the business as a whole. Organisations are more prepared than ever to bring in managers without IT backgrounds to run things.
Many of the companies advertising jobs are looking for people who can manage revitalised data centres. With sales of mainframes growing at between 50 and 60 per cent a year, 'big iron' is in for 1997. Not that the iron is particularly big any more. The new breed of smaller, cooler mainframes based on CMOS chips has given the lie to Grosch's 45-year-old law that the bigger the system, the cheaper the unit cost of processing power.
Alfred Tauchnitz, founder of German software company Beta Systems, says: 'The data centre has been given back central responsibility because many companies have discovered that client-server is more expensive than they originally thought. Tauchnitz claims this is a trend that can be seen in the whole of Europe.
Where previously IT departments might run four or five mainframes, they are now managing 50 or 60, reports Tauchnitz. 'I predict that the IT director will become more important towards the end of the millennium. We are already seeing what I call re-insourcing, a swing away from outsourcing.'
Boards of directors are beginning to re-examine outsourcing. In some cases, they have achieved cost savings of up to 40 per cent on their IT budgets, so they are now being forced to assess the hidden costs of opting for a service provider.
Apart from the overheads involved in managing outsourcing contracts, some companies also find themselves constrained by a technology straitjacket.
They discover that they cannot make cost savings or introduce new applications because the technology is not part of their existing agreement.
Whatever the outcome of the outsourcing debate, IT managers are likely to be better paid, better trained, better respected and at the heart of the business once again. The only remaining question is how they will find the time for all the extra work.
John Lamb is Business Computer World's contributing editor.
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