The Gartner Scenario for 2010: The Current State and Future Direction of the IT Industry

Ken McGee & Dale Kutnick share the stage for this "classic" session about the current and future state of IT.

They will do a quick review on the IT economy and then at 3 technology pillars for executives: techonomics, risk management and business enablement (vs. cost only).


2009 saw staff and budget costs but most people say they "manage" it. During this period, organizations managed to deliver enhancements and projects. And 2010 will not see growth, maybe even reductions again. But you will have to enable business growth.

Trends and conditions affecting executives in 2010 (towards 2012)

GDP growth in Europe in 2009 (so far): -4%. Projection for 2010: +0.9% (2.6% worldwide and 1.2% in France). By industry, banking is down ~20% in 2009 end should grow ~5% in 2010 (3.3% in Europe).

Vendors such as Oracle have increased revenue with maintenance price hikes, for a significant part. Some services companies (IBM, CSC) have done OK. Google is about "recession-proof". Microsoft has seen a sharp decline.

IT spending total is down 5.2% in 2009 and should grow 3.3% in 2010.

Where the "new" IT money will be spent?

Gartner used a "tool" asking if the budgets constraints have negatively affected their operations, then identifying the prefered sectors of spending, with hypothetical increased budgets. The last issue is about where the responsibility should lie (in IT or business).

CEO priorities are:
- Cost cutting (68%), IT can help most cut operating costs, not only IT.
- Increasing revenue (53%): for example, increase salesforce productivity.

CIO budgets were down 4.7% in 2009 and should remain flat in 2010.

8 issues are "stuck" between business and IT:

• Applications: in general, there has not been any deterioration in 2009. Focus, with more money, would have been on information architecture, MDM, performance management, application overhaul, ALM. This is the job of IT and the main issue is about application modernization.


• BI and information management: again no deterioration in 2009, it actually did not see budget reduction. The "wish list" includes: improving data quality, decision platforms... If underfounded, BI stops being used: the value delivered is visible. Sponsorship is lacking and should be among executives.


• Business process improvement: no deterioration in 2009, budgets grew slightly. The wish list: hiring BPI professionals and adopt BPI technologies (suites, modeling tools, rules engine). There should be significant growth, e.g. with pattern management and document management (for regulatory purposes). The business executives should step up to sponsor BPI.


• Entreprise architecture: no deterioration. Wish list: communication and collaboration, concurrent engineering. The job is about maximizing the value of the IT infrastructure, then people need to be able to "analyze" the customers (detect the changes). This is an IT issue.


• Infrastructure and operations: no deterioration (mostly because there was less demand and it got cheaper). Wish list: energy efficiency (but green for green is not the issue), storage, data center upgrades, unified communications (again not for the productivity improvements). IT can explain the cost issues (and take the lead).


• Program and portfolio management: no deterioration. Wish list: re-implement the software client, invest in more training. Leader: business executives with an issue about how much formal process is needed.
  


• Security and risk management: no deterioration, there were not much cost cuts. Wish list: identity and access management, governance... The leader is on the business side (because of the top issue of business accountability).


• Source and vendor relationships: there has been deterioration (the outsourced activity was not properly monitored day-to-day). Wish list: vendor management tools and competencies, spending analysis tools... The issue (for which the IT is responsible) is how to get the vendor deliver what has been promised.

Longer-term trends most affecting the IT industry

The emerging technoolgies hype cycle revolves mostly on business enablement, risk management.

At or near the bottom of the recession is the best time to prepare to change how to do things (2 checklists are provided: looking outward and inward), for the return to growth.

Action plan: complete plans on how to deliver business growth (without increased budgets), publish impact of 2009 funding will have on IT in 2010, decide on the type of growth you will support.