Outlook 2003Outlook 2003

When it comes to technology projects, managers put their highest priorities this year on PCs, Windows servers, network- and systems-management tools, and network-security management software. In some cases, hard-pressed vendors are offering deals that are good enough to thaw frozen hardware budgets. R.R. Donnelley Financial, a financial-services subsidiary of the printer R.R. Donnelley & Sons Co., hasn't bought PCs since a major year-2000 upgrade, says Flyn Gropack, VP of technology management. Now the company plans to refresh 20% of its PCs annually.

R.R. Donnelley Financial also has changed its PC buying strategy. It had planned to standardize on one vendor's PC platform. But recently, the reseller CDW Computer Centers Inc. agreed to sell the company 1-GHz Hewlett-Packard Compaq PCs at $200 less per unit than R.R. Donnelley had been paying Dell Computer. "At that price, it's hard not to refresh," Gropack says. Donnelley is also buying IBM ThinkPads through CDW.

Rayonier's Nettles has an IT staff of 55 to 60 people, and he's seeing deals in the technology-services market as well-deals that make offshore programming look less enticing. "We had done some offshore work in India at attractive prices, but prices have come down in the U.S.," Nettles says. Rayonier is looking to hire small local companies for PeopleSoft and SAP jobs.

Services is another area in which business-technology managers are divided on the best approach. Three in 10 managers say their spending on IT, networking, or outsourced services will rise this year, while almost half say they will stand pat on services spending.

The sour economy has meant sweet deals on talented employees, but most business-technology managers still aren't buying. Slightly less than two-thirds plan to have the same number of IT and networking workers this year as last, and 19% expect to make staffing cuts.

Georgia-Pacific's Dallas says the company will focus on developing rather than hiring people this year. Beginning early in the year, he'll start a business and leadership program called "Lunch and Learn," in which business and technology executives from other companies will talk to Georgia-Pacific IT managers and employees about how they're using IT to support manufacturing, sales, career development, and process changes. The goal is to have six Lunch and Learn sessions this year, with staff at locations outside the Atlanta headquarters attending by Web and video conferences.

KeyCorp's Rickert says his group is fully staffed, but he'll still hire if he finds a person skilled in integrating legacy and Web systems. "There are a lot of good folks out there," he says. The reasoning is the same, whether it's building up staff skills or automating business processes to build closer customer relationships, Rickert says. "Sooner or later, the clouds will part and the things will be shiny again," he says. "We want to be ready and ahead of the curve when that happens."

With luck, this will be the year those prepare-for-the-upturn plans of Rickert and others are put to the test.

Illustration by Joyce Hesselberth