Philip Hughes, soon to relinquish the reins at Logica Plc, was in Scotland the other day to address the Computer Services Association at the Gleneagles Hotel. He believes that the force for change in the 1990s will be open systems, and it poses particular challenges for vendors. Those vendors pushing open systems most vociferously are the same companies attempting to create a common software environment that can compete with IBM’s environment. However, Hughes says that there is a dichotomy since the development of open systems means that hardware and system software will become less distinctive. Consequently, specialist features will be secondary to price-performance and applications. He foresees vendors and computer services companies working closely together to develop formal and financial links. And to an extent, this is already happening. IBM has invested in numerous software companies, and the Japanese software industry is characterised by large scale vendor investment. On a more positive note, Hughes welcomes the possibility of developing software that is transferable between different computer systems. It means that developer success isn’t dependent on specific vendor success, and it will loosen existing ties to the IBM user base. Hughes forecasts several other major changes in the software industry, and he believes that software engineering will be one of the most significant. He is surprised that software engineering has had such a limited impact, but the next decade should see a a rapid progression. The software industry will focus on productivity rather than achieving profit by drafting in the large teams that have traditionally generated large revenues. Nonetheless, Hughes sees increasing investment in hardware and software environments as a prerequisite to successful software engineering activities, alongside a greater commitment to staff training. Telecommunications, specifically those that have been deregulated, offer opportunities for establishing value added networks. Hughes says that vendor investment is likely to be mirrored by telecoms companies, as both AT&T and Nynex have already done in the UK. Hughes reckons that the days of the traditional service bureau are numbered, and joint companies will be formed aimed at particular user requirements. He sees this as posing problems for the independent services company. If a services company is linked financially to one client, it could jeopardise perceived independence. However, Hughes acknowledges that several French companies are partially owned by banks, and it hasn’t had an adverse effect on them. He believes that the demand for new application systems is going to force more collaboration between users and vendors, but maintaining independence in the face of mergers and cross holdings will remain a key question in the 1990s.
