IT salaries race ahead of the pack

IT salaries rose an average of 5.1 per cent during the 12 months to April 2000, well above the 3.6 per cent increase in average weekly earnings (AWE) recorded by the Australian Bureau of Statistics during the 12 months to February, according to the Australian Computer Society. The Consumer Price Index (CPI) rose by 2.8 per cent in that time.

Conducted on behalf of the ACS by the Association of Professional Engineers, Scientists and Managers, Australia, the survey questioned 2,000 ACS members employed across all industries and job functions. According to the survey, the strong growth was fuelled by IT professionals working in the private sector, who earned average increases of six per cent compared to the 3.6 per cent increases gained by those employed in the public sector.

IT professionals in the private sector continue to command salary increases well above those experienced in other industries and attribute their wage rises to factors such as Y2K, the growth of e-commerce and the demand for Internet and networking skills. The survey revealed that IT professionals in the private sector earned an average total package of $A103,460, compared to an average total package of $A95,279 across all sectors.


Growth in the e-commerce software applications market shows no signs of letting up according to IDC, which forecasts worldwide revenues will explode from $US1.8 billion in 1999 to $US23 billion by 2004. While growth of revenues will remain constant, vendors will need to change their business models to take advantage of new opportunities. E-commerce software vendors can no longer count on application licenses as a dependable revenue stream. Increasingly, they have to accept the fact that their long-term success will depend on additional revenue sources, such as transaction charges, subscription fees, shared revenue with partners and affiliates, and advertising as well as other creative ways of generating new and recurring product revenue. These additional revenue streams will become much more evident as e-commerce software vendors get involved in building e-marketplaces and Web-based trading communities.

IDC expects the share of e-commerce software applications revenues generated by product licenses to plummet from 90 per cent in 1999 to 32 per cent in 2004. During that same time, the share generated by transaction fees will skyrocket from four per cent to 29 per cent. Transaction fees reported as product revenues will be generated from functions such as automatic matching of buyers and sellers via personalisation, order execution, tracking, routing and payment reconciliation.

Another change that occurred in 1999 was the market's front-running vendor. Broadvision captured the market's top spot with $US81 million in revenues and a 4.5 per cent share. Oracle was a close second with $US80 million in revenues and a 4.4 per cent share. Last year's top player, Keep the customer satisfiedAccording to a new study by Gartner Group, enterprises engaged in e-commerce should ensure that their call centres are in order before spending time and money on cutting-edge e-commerce applications. The Gartner study contains the results of interviews with 600 decision-makers of customer relationship management (CRM) solutions in North America.

CRM, a major marketing and e-business focus for executives, includes deployment of call centre applications, data warehousing, sales force automation, marketing automation and e-commerce applications.

According to the Gartner survey, enterprises rank e-Commerce as their most important investment priority, but call centre applications are ranked first in terms of functional importance. However, investment in call centre applications is ranked fifth. The lower ranking for call-centre investment in the coming year may be because of investments already made in call centres or because IT investments are being funnelled into e-commerce initiatives. Gartner advises enterprises to maintain state-of-the-art call centres before and during e-commerce expansion.

Look smart when looking ahead

If you are wagering on the software market, IDC says the smart money will bet on applications, tools or infrastructures that add intelligent, closed-loop feedback to business processes. In 1995, with the emergence of CyberSmart computing, companies began to achieve their first real productivity gains attributed to IT investments, but these pale in comparison to what is possible according to IDC.

The shift to CyberSmart computing is the single most important reason for the surge in productivity in the last few years of the 1990's and the reason for the enormous enthusiasm for e-business today, IDC analysts believe. Businesses have finally figured out that computing for the sake of using computers to automate old business processes doesn't really generate productivity gains. Businesses have stumbled on the fact that adding closed-loop, iterative analysis to IT is the key to competitive advantage.

IDC defines CyberSmart computing as combining smart information with natural user interfaces in applications that know no bounds on the extended computing network -- they have total operating environment transparency. For the next few years at least, demand for software will be impacted by how software tools, applications and system services facilitate and lower the lifetime costs of implementing strategic business feedback processes, which are -- more often than not -- related to e-business.

Web-enable offline shops to win buyers

To optimise online benefits to in-store shoppers, retailers must roll out Web-enabled devices to offline shops, according to Forrester Research. Retailers must implement kiosks and Web-enabled point-of-sale (POS) systems to supplement face-to-face service and sell products available solely through the Web, a Forrester analyst explained. To manage these new multiple endpoints, merchants will need a channel manager to automate translation of Web selling tools for use in brick-and-mortar shops.

To prepare themselves for this new set of in-store devices, merchants will need what Forrester calls a channel manager -- a software tool that brings the basic benefits of online selling tools into stores. Channel managers will translate online tools and content to new outputs, add intelligence for cross-channel personalisation, and transmit information beyond the brick-and-mortar store via mobile devices. Determining which devices and tools to use will require retailers to map their products to the most appropriate applications.

Retailers will have to employ channel integrators that will work with e-Commerce design firms to create new interfaces that will not only be appropriate for in-store kiosks, but also remain consistent with the online brand, Forrester explained. To automate the conversion of Web-based content and applications for new devices, retailers will need to get aggressive about features and descriptions.

Supply chain services unshackled

Revenues in the worldwide services-supply-chain (SSC) vertical applications market (which includes the financial services, healthcare delivery, and professional/AEC services segments) are on a growth track that will leave them at $US34 billion in 2004, up from $US18.5 billion in 1999. Until the end of 2004, the fastest-growing segment of the market will be SSC applications for professional/AEC services, according to research by IDC.

The SSC vertical applications market includes applications that are designed to automate specific industries and industry-related functions in the services supply chain. Many factors are fuelling growth of these applications. The main factors include competitive pressures within the services supply chain caused by the rapid launch of new services and customer demand for better responsiveness.

According to IDC, revenues in the professional/AEC segment will increase at a compound annual growth rate (CAGR) of almost 18 per cent. from $US2.8 billion in 1999 to $US6.4 billion in 2004. In comparison, the overall market will increase at a CAGR of 13 per cent. IDC believes application service providers will contribute to growth in this segment.

In 1999, the largest segment of the market was financial services, and until the end of 2004, it will continue to generate the largest portion of SSC revenues. However, at a 1999-2004 CAGR of 9.7 per cent, it will grow slower than the overall market.

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More about Association of Professional EngineersAustralian Bureau of StatisticsAustralian Computer SocietyAustralian Computer SocietyBroadvisione-marketplacesEndPointsForrester ResearchGartnerGartnerIDC AustraliaOracleScientists and Managers

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