• silicon.com
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• Software

By Tony Hallett, 28 June 2004 15:05

NEWS Organisations' IT functions are becoming more efficient - though only slowly.

Such a change is a major issue for a range of vendors preaching application performance management, whether through provision of a service or software. At or near the top of this list is Mercury, the Silicon Valley software success previously known as Mercury Interactive.

"When I look today at how companies are deploying technology, it's still very amateurish," said Amnon Landan, Mercury chairman, president and CEO. "To say they aren't efficient is an understatement."

While most of Mercury's revenues - around 60 per cent - still come from its testing business, where it competes with the likes of Compuware, the company has been growing steadily by riding different waves, often through acquisitions, as was the case with performance management through the purchase of Freshwater in 2001.

However, Landan and the others at the company, which reported first quarter revenues up 42 per cent at $156.8m in the three months ended 31 March 2004, realise they must do more to marry what IT offers to business needs.

As such, in 2002 the company came up with a new TLA (that's three-letter acronym), business technology optimisation (BTO). Analyst houses such as Forrester and Gartner bought into the concept, as did influential partners such as Accenture. Yankee Group analysts forecast the market will be worth $6bn by the end of 2007.

However, most recognise BTO as marketing shorthand as much as accurate nomenclature.

"Some organisations have become more open [to the idea] than they were six, 12 or 18 months ago," Landan told silicon.com at a recent Forbes CEO conference in London. "One issue is that IT operates in a vacuum. If you really want to harness it, you have to get closer to how IT impacts the business."

Mercury cites customers such as GE Medical and mobile operator Cingular as examples of organisations that can properly marry IT to their business needs.

And the future of the phrase BTO? Landan added: "I admit, it's not yet an industry term. But it is being recognised more and more. To be honest, I don't care. The essence is that this category is being formulated. Customers are getting it."