More and Less

Outsourcing, Linux, and SAN adoption cited as major trends

IE Index Hewlett-Packard With president Michael Cappellas' departure to WorldCom, CEO Carly Fiorina will have no one else to blame if the "new" HP falters. Hyperion Solutions Corp. and SAS If Cognos executes its Adaytum acquisition as planned, Hyperion and SAS will be in for some tough competition in the performance management market.br> Sybase The company's purchase of erstwhile mobile computing darling AvantGo will burnish the already bright prospects of its iAnywhere Solutions subsidiary. INDEX LEGEND HOT — On the upswing NOT — Possible trouble ahead STATUS QUO — No change

Less hiring and more outsourcing is one of the major messages from senior IT management, according to recent Evans Data Corp. surveys.

Outsourcing development has increased by 175 percent in just 18 months for large companies, according to nearly 400 responses from enterprise development managers and decision makers. Evans Data analyst Joe McKendrick says the rise reflects a "turning to outsourcing as an alternative to hiring of full-time employees whereas, in the past, most companies turned to outsourcing for additional expertise."

"Contractors are typically the first to go when the economy heads south," McKendrick says, "and the first to be hired before companies commit to new full-time employees."

After a two-year slowdown beginning in 2001, large companies in particular are now vigorously pursuing contract programmers for company-development projects. Approximately 80 percent of companies employing 10,000 people or more outsource development projects, while the figure is 66 percent for companies with 1,000 to 10,000 employees.

Integrate wisely and you'll be rewarded with a hefty return on investment, or so goes the wishful thinking. Rise in Linux use and storage area networks (SANs) received the most attention in the Evans Data survey, although findings indicate that most companies only partially integrate Linux.

Large companies are relying heavily on SANs for their enterprise storage systems. Sixty-two percent of large company managers and decision makers surveyed indicated that they plan to increase their SAN use over the next two years; 20 percent expect to maintain their current level, and only 3 percent will decrease SAN use.

Linux is celebrating its most widespread use to date, but the open source operating system typically isn't deployed across the entire enterprise. A spike in the number of companies using Linux — nearly 60 percent of survey respondents, up from 43 percent just six months prior — seems noteworthy. However, most programmers restrict Linux to less than a quarter of their total systems. Only 3 percent of organizations run Linux on a majority of their servers.

In a separate study, research outfit Aberdeen Group also cited Linux adoption and outsourcing as major trends to watch in 2003.

— Jill Duffy

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