Viewpoint: Buck Bothers in The 21st Century

IT firms might find themselves short of business if they don?t start looking beyond 2000

This fin de siecle is turning into a bonanza for IT resellers and integrators. Like every good chapter?s end, there is a rising frisson as we anticipate an IT climax centred on people, companies and technologies ? although mainly it is the year 2000 issue which fascinates us. What will happen? We all wait to see how right or wrong the predictions are. In the meantime, most resellers are doing better than ever, forecasts are optimistic and salaries and balance sheets are looking great.

But it won?t last. It?s no fun to think of it, but cast your imagination forward into the next century. The year 2000 will be behind us, for better or worse, as either a period of historic chaos and disaster or no more than a minor hiccup. Like the aftermath of a war, there will be an inevitable mopping-up operation which will probably last six months, but hardly longer ? any businesses which take more time to adjust won?t still be in business.

The degree of our participation in European monetary union (EMU) will be decided ? we?ll probably be in it ? and even if we are not, there will be plenty of work for the next few years helping businesses which need to deal with foreign customers and suppliers. But once all those problems are resolved, there will also be a deep slump in business for EMU-compliant systems providers.

The first to feel the chill will be programmers. At the moment they are on a high which is still rising. Salaries are going through the roof for skills which were once thought dead; programmers are relearning old skills and finding them in strong demand. It is hard under such circumstances not to feel comfortable and complacent.

Consultants, too, are in demand like never before. There are advertisements appearing in the Sunday recruitment supplements for senior consultants with IT skills with salary labels of #180,000 plus. Now that?s serious money.

There are also many IT channel businesses which are seeing growth far in excess of predictions because they have focused on issues like the year 2000 problem and EMU. Firms which centre on the updating and replacement of legacy systems are reporting record business, but there has to be a crunch time when virtually all legacy systems are replaced with systems which can be easily and cheaply maintained.

The inevitable fall-off in demand is bound to arrive with a dramatic crash soon after the year 2000 has come and gone. It is not hard to predict ? all crescendos are followed by a crash and a depression, and the one of the early 2000?s is likely to be a cracker.

Few IT businesses will be able to cope with a dramatic fall in business. Despite their youth and entrepreneurial spirit, most have grown up in a climate when they have never had it so good. Business has dropped into their laps. They have not really had to sell very hard at all. But all that will change, suddenly and dramatically.

Those IT companies which survive will be the small, at least in terms of decision-making hierarchies, and flexible ? those unafraid to do a spot of navel gazing and make some tough but essential decisions, and those for whom the crash will not come as a surprise.

OK, it seems a long way off, but now is the time to think about the directions your business and career could take if you take away the legacy system replacement, the sale of tools and services linked with the year 2000 and the consultancy associated with the millennium issue and EMU.

There are some fairly safe bets: electronic commerce and electronic trading will probably be coming into their own by 2002, and the use of smart cards, PDAs and portables will be de rigeur. We could do with some new applications which take proper advantage of the small and incredibly powerful products which are going to be available through superstores. And the internet will be maturing into a familiar household facility. Most businesses will be Web-centric, and local networks will be more powerful and easy to manage, enabling a small business to operate globally with ease.

But I?m not here to crystal-ball gaze. I just want to point out that these are unusually rich times, and plenty is always followed by famine as sure as eggs is eggs. Many individuals are already making plans ? I hear a lot of talk about downsizing and teleworking. But those new ways of working largely depend on there being an infrastructure of businesses still operating in the traditional ways.

Provided you are thinking long-term you will be all right. It?s those with their heads down, who can only see the current big profits and strong business, that will be in trouble.