For Application Development & Delivery Professionals

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1 October, 2011 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster by Mike Gualtieri for Application Development & Delivery Professionals Making Leaders Successful Every Day

2 October, 2011 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster by Mike Gualtieri with Mike Gilpin and Adam Knoll Executive Summary Many CIOs are on the hot seat to innovate by delivering increasingly critical applications more quickly. To keep up with the accelerated pace of business, CIOs and application development and delivery leaders must re-evaluate how they develop and deliver applications. Forrester interviewed 15 CIOs to learn how they are coping with this challenge. Successful CIOs advise moving beyond being just an order taker by pragmatically eliminating complexity, introducing Agile where appropriate, and anticipating critical business needs. table of Contents 2 Demand Exceeds Capacity 5 Faster Business Change Demands Faster Application Delivery CIOs Think Application Development Is Too Slow And Ineffective New Application Development: Not An A-Student In The Bunch Changes To Existing Applications: Most Not Meeting Business Expectations CIOs Must Also Deliver Applications That Satisfy Users CIOs See Application Development Facing Several Obstacles CIOs Advise: Be Pragmatic, Do Agile, And Eliminate Complexity And Redundancy NOTES & RESOURCES Forrester interviewed 15 North American and Western European CIOs and IT leaders. Related Research Documents How To Become A BT Leader And Leave IT Order-Taking Behind August 1, 2011 Embrace App Internet Architecture To Win In The Next Era Of Computing July 18, 2011 Mobile App Design Best Practices April 12, recommendations To Get Faster, Move Beyond Just Being An Order Taker WHAT IT MEANS 8 Application Delivery Is Not Changing Fast Enough 8 Supplemental Material 2011 Forrester Research, Inc. All rights reserved. Forrester, Forrester Wave, RoleView, Technographics, TechRankings, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective owners. Reproduction or sharing of this content in any form without prior written permission is strictly prohibited. To purchase reprints of this document, please clientsupport@ forrester.com. For additional reproduction and usage information, see Forrester s Citation Policy located at Information is based on best available resources. Opinions reflect judgment at the time and are subject to change.

3 2 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster Demand Exceeds Capacity Demand exceeds capacity. This is a common sentiment we hear from CIOs all the time. Why? Because our time-tested ways of delivering IT solutions are no longer fast enough to satisfy business leaders and the customers they serve. The breaking point has been a long time coming. In the 1990s, globalization drove new competition and faster business cycles. The movement of businesses and business functions to the Internet during the late 1990s pressed on the accelerator of business change. Now, continuous uncertainty marked by the Great Recession has prompted many firms to transform their mission, structure, and operations. Businesses face two types of change: Deep transformational change. Many firms are experiencing fundamental change in their market or regulatory environment. To survive and thrive, many firms must re-engineer their business models, business structures, and business processes. Deep transformational change remakes companies. The unrelenting fine-tuning of business processes and customer channels. And then there is the day job: incorporating small and large changes into the applications used to run the business and interact with customers. Each of these changes tends to be small, but in the course of a month or a quarter, they can add up to many IT delivery projects. Faster Business Change Demands Faster Application Delivery The velocity of change must increase to keep pace with competitors, pounce on new market opportunities, and especially meet the increasingly fickle desires and expectations of customers. To keep pace, CIOs must find ways of developing and delivering applications faster. To gain insight into how IT organizations are coping with faster change, Forrester interviewed CIOs, asking these three research questions: 1) How well are enterprise IT organizations keeping up with the needs of the business? 2) What are the top obstacles faced by IT organizations in developing, delivering, and changing applications faster? ) How should IT organizations respond to the need for faster, continuous change? October, , Forrester Research, Inc. Reproduction Prohibited

4 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster CIOs think Application Development is Too Slow And InEffective To find out just how much pressure CIOs feel to develop and change applications faster, we asked them to rate themselves on how quickly they can develop new applications and change existing applications. To gain deeper insight, we also asked them to predict how their business clients would rate them as well (see Figure 1 and see Figure 2). Figure 1 New App Development: CIOs Don t Think Their Business Partners Appreciate Their Efforts How well does your organization develop new applications needed by the business on a timely basis? How do you rate your IT organization? Often good (B) Needs improvement (D) How do you think your business partners would rate your IT organization? Often good (B) Excellent (A) 1 Needs improvement (D) 7 Sometimes is good (C) Sometimes is good (C) 089 Base: 15 North American and Western European CIO and IT leaders Source: A commissioned phone interview with global CIOs conducted by Forrester on behalf of Compuware, June 2011 Source: Forrester Research, Inc. 2011, Forrester Research, Inc. Reproduction Prohibited October, 2011

5 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster Figure 2 Changes To Existing Applications: Most Not Meeting Business Expectations How well does your IT organization change applications needed by the business on a timely basis? 089 How do you rate your IT organization? Excellent (A) Often good (B) 8 How do you think your business partners would rate your IT organization? Needs improvement Excellent 1 (D) (A) Needs 2 1 Sometimes is good (C) Often good (B) Sometimes is good (C) Base: 15 North American and Western European CIO and IT leaders improvement (D) Source: A commissioned phone interview with global CIOs conducted by Forrester on behalf of Compuware, June 2011 Source: Forrester Research, Inc. New Application Development: Not An A-Student In The Bunch When asked how well their organization develops new applications on a timely basis: CIOs think they are doing a pretty good job. Twelve out of the 15 CIOs we interviewed gave themselves B s and C s. None of the CIOs we interviewed gave themselves an A. Three gave themselves a D. CIOs don t think their business partners fully appreciate their efforts. Unfortunately, seven CIOs think their business partners would give them a D. In contrast to their rating of themselves, CIOs believe that their business partners would rate them much lower for new application development. This represents a big gap between how CIOs think they are actually doing and how they imagine they are perceived by the business. Changes To Existing Applications: Most Not Meeting Business Expectations When asked how well their organization changes applications on a timely basis: October, , Forrester Research, Inc. Reproduction Prohibited

6 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster 5 Only one CIO said that his organization was excellent at application changes. Eight CIOs of the 15 we interviewed gave themselves a B, and one scored an A. Most CIOs felt that they were often good or even excellent at making changes to applications. Business partners give them heat. Only four CIOs thought that their business partners would give them a B. Six said that their business partners would give them a C. cios Must Also Deliver applications That Satisfy users Business needs trigger the demand to develop and change applications. But employees and/or customers use those applications directly or indirectly. To be successful in application development, CIOs must also satisfy these users. We asked CIOs how they thought users would rate both legacy and newly developed applications (see Figure ): 1) None of the CIOs said that users were very satisfied with legacy applications, and 2) four CIOs said that users were very satisfied with newly created applications. Figure User Satisfaction Of Newly Developed Apps Improves Significantly Over Legacy Apps When thinking about the user interface to the applications your IT organization develops, how would you rate the user experience? How do you rate the user experience of legacy applications? How do you rate the user experience of newly developed applications? Users are satisfied very dissatisfied very satisfied dissatisfied 2 neutral neutral dissatisfied satisfied 089 Base: 15 North American and Western European CIO and IT leaders Source: A commissioned phone interview with global CIOs conducted by Forrester on behalf of Compuware, June 2011 Source: Forrester Research, Inc. 2011, Forrester Research, Inc. Reproduction Prohibited October, 2011

7 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster CIOs See Application Development Facing Several Obstacles The enterprises in our study all face five major barriers to change in their organizations; and in fact, their survival is often in play. Demand exceeding capacity. CIOs report that they simply don t have the staff to handle all of the incoming requests from the business. Firms are extra cautious about their budgets and are reluctant to hire the way they used to, just in case the economy worsens. We are a rapidly growing organization with a huge number of priorities. IT works best when business has a high number of priorities, but when the demand is too high and the business cannot prioritize, then we have a problem. (IT director at a UK-based insurance company) Skills shortage. Even in the aftermath of the Great Recession, CIOs find it challenging to find talented people to fill key positions. Technology is changing rapidly and so are the expectations of the application user interface. Smartphone and tablet application development skills are hot. Complexity of legacy. Most CIOs we interviewed have hundreds of applications in their portfolio. No application is an island. The applications are interconnected to provide the business capabilities needed. When the business requests a new capability, it often involves multiple applications, complicating the overall effort to deliver. Fuzzy business requirements. The age-old problem of getting solid requirements is still a challenge, amplified by the urgency of business change. The business needs capabilities faster, and that means teams must flesh out the real requirements much sooner because there is less time for rework. Complexity of platforms. Most large firms have a plethora of technology platforms and tools. This complicates application development because of skills and knowledge of legacy code. We have too many platforms (.NET, SharePoint, Java, PeopleSoft, and Siebel). These core systems have to integrate. We also have differences in methodology within the individuals in the team. Some teams use Agile; some use Waterfall. (CIO at a UK human resources [HR] and recruitment organization) CIOs Advise: Be Pragmatic, Do Agile, And Eliminate COmplexity And Redundancy Forrester asked the CIOs to provide words of wisdom for other IT organizations to develop and change applications faster. They said: Understand your road map early on as well as your budget. Consolidate as much as possible because it s all about your reaction time to business requests. Consolidation helps reduce that reaction time. (Senior vice president for application development at a North American recruitment company) October, , Forrester Research, Inc. Reproduction Prohibited

8 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster 7 Find a pragmatic solution as quickly as possible. I always end up delivering most things twice. Invest a lot of time and effort in the end-to-end software development process. Make sure it is well documented. Speed time from business idea to implementation. And most important, if your team is not big enough or lacks the right skills, then use co-source suppliers. For example, find a vendor which is a testing specialist that can give you a methodology to follow. (IT director at a UK-based insurance company) Minimize development environments. Have real true architecture as the core of the decision-making process, and pick one integration framework that will solve a lot of problems. (CIO at a UK HR and recruitment organization) Before you can talk about faster application change, you have to build a trusted relationship with the business. Focus on the technologies that really matter to your business. We have created a true supply and demand organization. (Director of application development at a US-based manufacturing company) These are lessons learned in my 10 years. Look at off-the-shelf and cloud solutions for commodity-based needs. Only invest in differentiation that helps the company achieve its strategy. Keep MOOSE [the cost to maintain and operate the IT organization, systems, and equipment] costs as low as possible. Invest in R&D [research and development] to understand how you can change legacy applications to improve. And finally, continue to invest in training to keep your talent up to date and interested. Keep talent fresh. (President of technology and CIO at a media firm) Introducing Scrum made a big difference to our organization. It not only increased speed but also helped make the team more consolidated. Make sure that you are entirely comfortable with the development framework and environment. (CIO at a Netherlandsbased technology services organization) Recommendations To Get Faster, Move Beyond Just Being an Order Taker The pace of everything has accelerated. Customers want faster service. Users want better user experiences. And the business needs applications faster to satisfy customers, beat competitors, and drive productivity to boost profits. The CIO is the linchpin and knows it. Leading CIOs are changing the way IT does business to get faster by: Anticipating business needs. Understanding the requirements and scope of a business need has always been a key challenge to getting applications developed faster. IT cannot rely on the business to convey the requirements perfectly. IT organizations must get into the business to understand. They must anticipate the requirements before the business needs them to get a head start. 2011, Forrester Research, Inc. Reproduction Prohibited October, 2011

9 8 CIO Perspectives On App Dev: We Need New Approaches To Deliver Applications Faster Finding better tools and technology to develop applications faster. Traditional application development platforms such as Java and.net are not necessarily the fastest approaches to develop applications. CIOs should investigate application development productivity platforms that make application development professionals more productive. Elevating user experience design in applications. User satisfaction is increasingly important. Customers and employees have increased expectations about application user experience because of the applications they use in their personal lives, such as iphone apps and social web applications. WHAT IT MEANS Application Delivery Is not changing fast enough CIOs and application delivery leaders clearly understand that they must develop and deliver applications faster. But they are so loaded down with existing projects that they are not changing their organization fast enough to speed up the most time-consuming aspects of custom application development. CIOs and application delivery leaders face significant obstacles in getting faster and closing the gap between application delivery and business expectations. Leaders who harness this expectation gap to build support for the difficult steps required to overcome these obstacles will outpace their competition in using software to drive more customer value. Supplemental Material Methodology In this study, Forrester interviewed 15 North American and Western European CIOs and IT leaders to evaluate how their companies deal with business changes. The study began in May 2011 and was completed in June October, , Forrester Research, Inc. Reproduction Prohibited

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