2007 to 2027: The shape of things to come in IT
- 30 September, 2007 22:00
The computer industry
Joe Haldeman professor at MIT, author of The Forever War, winner of three Hugo Awards and four Nebula Awards for science fiction
In some not-too-distant future, the computer industry will be as obsolete as the Old South's "peculiar institution." Once computers are self-aware and completely networked, they will do what benefits them, regardless of the desires of the mushy mortals who invented them.
The customer age
Paul Greenberg author of CRM at the Speed of Light, President of The 56 Group
In order for CRM to have any future-meaning CRM as a strategy for customer engagement-the enterprises have to realise it's time to cede control to the customers because the customers already have it. The ascension of wikis, blogs, podcasts, Web 2.0 and social networking, combined with the ability of the customer to easily acquire the products and services that they want from multiple places-whether it's Best Buy, Circuit City or a local mom-and-pop shop, at roughly the same price and the same speed-have changed everything.
The move for companies is from a strategy of managing the relationship with customers to managing customer engagement so that the customer is not what we think of as a loyal customer but a customer advocate on behalf of the enterprise who can form a collaborative team. That's a big shift in CRM.
The Thought Market What does innovation really mean? Where do ideas come from? Some come from CIO Executive Editor Elana Varon's Innovation and IT Strategy blog at advice.cio.com.
Companies have to realize that the customer ecosystem is utterly dominant. The hard part for companies is acting on that, being transparent and making marketing the start of a conversation, as opposed to a division that pushes out hype to capture the customer's attention. This will take CRM into the whole 2.0 world, which it's currently not in. It will take a lot of companies a long time to get there.
The CIO evolution
Glen Sallow of service delivery and technology, Ameriprise Financial
When I first moved into a technology leadership role, it was all about the effective and efficient enterprise. Over the years, my focus has shifted to the client. The next 10 years will be even more about the client. The challenge will be more and more about assessing how investments that enterprises direct toward improving the quality of life for their clients translate into setting enterprise investment agendas.
Put another way, the CIO will need to evolve as a leader, from automating to enabling to delighting and from internally focused to client anticipating.
The intelligent business
Brian Babineau Senior analyst, Enterprise Strategy Group
The world of BI is heading toward less structure, more chaos. This is not necessarily a bad thing because BI processes and technology thrive when there's more information coming from a variety of sources. I despise theoretical concepts that describe technology transformation (how many times can we really use 2.0?) so I'm going to predict that over the next few years there will be more focus on the intelligence aspect of BI. With the volumes of information to be searched and analysed, technology must help organizations decipher what's relevant and, more important, why it's relevant. BI will integrate more closely with enterprise search solutions to aggregate information sources and, through pattern matching and relationship mapping, make them more intelligible and useful.
Red light, green light
David Thompson CIO, Symantec
Starting now, CIOs are going to have to embrace renewable energy sources to power their data centres. They should start to think early in the design process about how to utilize wind, solar and hydro energy.
In the meantime, CIOs can have a real impact on IT energy management by utilizing server and storage virtualization. Efficient energy use is at the top of the list, but other benefits range from optimizing operation functions to increasing security and creating a simpler, more centralized IT infrastructure.
In the future, I believe we'll see an increased use of software as a service. Taking advantage of a hosted service to maintain operations without the logistics of maintaining current infrastructure or expanding infrastructure is another way of bringing down energy costs and usage.
Rules, regs and compliance
Trent Henry VP and research director, security and risk management strategies, Burton Group
When I consider the future of compliance, two "J" words come to mind. The first is "just," as in "just part of my job." That is, we'll focus less on compliance and more on prudent controls within the enterprise. And those controls will be part of the day-to-day activities of employees, not something special done for an audit report. The second is "jurisdiction." The global nature of business means that we have to be mindful of compliance issues not only in our home countries but also in other lands. That can be a real challenge because sometimes requirements might be at odds.
Tools we'll create
Dave Girouard Vice president and general manager, Enterprise, Google
Since its birth, IT has been about automation and has been designed around the needs of the business at the expense of people. So a procurement system or a manufacturing system has been designed to automate the business to reduce costs and to increase the speed of the business. That's what IT has been about, and all those gains have been wrung out. Now the really interesting things are about moving from a business-centric model to a people-centric model. CIOs are still seeing gains from business process reengineering and getting the last bits out of that. Dell has proven that the supply chain model is fantastic, but it only gets you so far. You have to be more than an incredibly efficient supply chain. So what's really going to define what the business does in the next five or 10 years is more about innovation in the tools people use and the environments people work in.
All tomorrow's software
Grady Booch IBM fellow, inventor of C++
Software-intensive systems will become increasingly invisible (as they weave into the interstitial spaces of society) and increasingly complex (for there is an essential, inescapable and growing complexity to such systems). Our civilization runs on software, and this reality will become even more true in the coming years.
The continuing rise in computing performance and storage will contribute to civilization's increasing dependency on software: the decreasing size of form factors; the dominance of intimately concurrent (multicore) systems, as well as massive, loosely coupled distributed systems; the presence of personal automated devices plus pervasive embedded systems and the advances in materials such as digital paper and the global economic pull toward software-intensive systems.
There will undoubtedly be some technical breakthroughs that we cannot anticipate: quantum computing, robotics, practical AI. These are all areas ripe for advancement. However, that being said, one thing we know is true: Developing software-intensive systems has been, is and will remain fundamentally hard.
Whither the CIO?
June Drewry VP of the Society for Information Management's Leadership Development Institute and global CIO, Chubb & Son
The CIO role has been increasing over the years with no indication that this is just a short-term situation. Technology permeates everything we do today. The technical choices, integration and execution get more and more complex. Only a very naïve person could imagine these technical responsibilities disappearing. Additionally, many CIOs are being seen as the best people capable of taking on new enterprisewide responsibilities of innovation, execution or integration.
Short term, you'll still be paying for ERP
Chad Eschinger Research director, software markets research team, Gartner
The ERP market will continue to see more consolidation and expansion. Most of the market's estimated $17 billion size is attributed to annual maintenance contracts. While we've seen and estimated solid growth for a market of this size, there are limited new sales opportunities outside of the small- and medium-size business.
Current sales activity with global organizations resides with instance consolidation and add-on sales as we find a majority of companies holding off major upgrade projects until the viability and commitment to existing portfolios can be articulated. We expect to see price compression to continue as the major ERP vendors assimilate yesterday's innovation into new releases, which will also continue to raise the bar for specialized vendors, making enterprise decisions more difficult. We also expect that SaaS will have an impact, though more in human capital management than in any other ERP market segment.
The outsourcing horizon
Jeanne W. Ross Principal research scientist, MIT Centre for Information Systems Research
The future leads to greater commoditisation and componentisation. Exhausted from efforts to meet the needs of clients who want customized services at bargain prices, outsourcers will shy away from big negotiated deals and work toward developing a menu of standard, individually priced products.
Outsourcing vendors will learn the art of cross-selling to enhance customer loyalty. Vendors will innovate only to the extent that it saves them money or helps them introduce new mass-market products or services. But they will contribute to client innovation by allowing managers to focus on strategic opportunities rather than on managing commodity processes-or the vendors that provide them.
Global customers will insist on global providers. But as the wage differentials from country to country start to diminish, vendors will reorganise around regional offices that will offer affordable wages by locating facilities outside of major cities. Vendors will thus adopt organisational structures similar to those of their clients: federal organisations that push much decision making to local offices. Wages will be somewhat higher when vendors rely primarily on onshore support, but the coordination costs will be reduced.
Today's kids, tomorrow's leaders
Linda Goodspeed CIO, Lennox International
The children of today communicate constantly and virtually. They are technically articulate and are expert multitaskers. If you extrapolate from current trends to the next 10 years, these children will be the leaders of masses of people in virtual corporations. All leaders will be CIOs of one nature or another. They will learn quickly and think naturally in terms of what technology can do for them. The function of running the company's back office may still be leveraged in one group, or outsourced, and the change management of software will still be required, but I see strategy and IT merging to deliver business benefits much faster than we can imagine.
Mass, decentralised customisation of business unit strategy led by business information leaders may occur. This new world will enable every business leader to change the system autonomously and rapidly while maintaining back-office synergies. I also believe that the world of virtual gaming and simulation software will be a way of life in corporations as we simulate and test market conditions before introducing new products or rolling out new business strategies. Today people go to school to learn technical or IT skills and join a company to gain business knowledge. This may be completely reversed in the future. IT skills will be a way of daily life and schools will need to focus on business skills to prepare students for this real world since so much of their time will be spent in a virtual world.
The CIO, transformed
John Stevenson former CIO of Sharp Electronics, board member of the Society for Information Management Foundation, president of JG Stevenson Association
Ten years from now, the CIO is the CEO: Chief Efficiency Officer. The consumer and business world will have had another major transformation. Individual consumers and business managers will no longer be content with shopping or conducting other commercial activities the old-fashioned way; they'll be using automated online tools that we're just beginning to fully embrace today. For example, real-time, interactive customer supply checker systems will directly interrogate customer inventory on hand for efficient resupply while allowing electronic payments that automatically operate under agreed-to terms. Or another example is car maintenance planners, where car mileage and other drive-train checks are electronically sent to the owner's chosen maintenance organisation. Appointment and/or backlog times will be sent back to the owner for planning for the needed maintenance. IT and CIOs will be the hub to deliver these changes.
Web 0.0, 1.0, 2.0 and 3.0
Philip Evans Senior partner, Boston Consulting Group
Web 2.0 is not a bubble. The dotcom bubble was really only a bubble with respect to capital markets (and the press). Almost every measure of real Internet usage merely paused for a year and then resumed growth at much the same rate as before. This time around, there may be bit of a bubble with respect to the acquisition prices of MySpace or YouTube and in the stock market valuation of, for example, Google, but that's hardly comparable to the Nasdaq mania of 1999 to 2000. Web 2.0 is here to stay because it's actually Web 0.0. Peer-to-peer, user-generated dialogue and content, and open, interoperable standards are precisely what the Web was originally about. The deviation was Web 1.0 (the dotcom craze), when the Web was reinterpreted as a new channel for old broadcast and hub-and-spoke proprietary business models. Web 1.0 was the fad; Web 2.0 is a return to the roots of the Internet.
What will Web 3.0 look like? The principles of the Web are what they have always been. There will be innovation of course, much of it unpredictable, but it will not, I think, be a rejection of Web 2.0, rather its proliferation. The most important innovations in the next few years will be the extensions of the Web to the mobile handset and into the television set, with many of the most interesting innovations occurring abroad.
Precisely the loose, mashed-up, interoperable, shared-IP, advertising-supported models we see in Web 2.0 will attack the vertically integrated, command-and-control, proprietary worlds of telephony, media and advertising. These are trillion-dollar global industries; the new technologies and business models are classically disruptive, the attackers are among the smartest and best-funded companies out there, but the defenders understand that their survival is at stake. Whether we call it Web 3.0 or not, this battle will command our attention for some considerable time.
When the next bubble bursts
Mark Polansky North American managing director of Korn/Ferry International's Information Technology Centre of Expertise
If there is a downturn in the economy, IT will be affected differently than it was six years ago. In the 2001 to 2003 time frame, the focus was on cost reduction. For the most part, enterprise IT has already done that. They've consolidated data centres, renegotiated vendor contracts and integrated multiple businesses onto common platforms. There's not much left to squeeze out without hurting functionality. If there's a recession, IT will simply hunker down and keep in effect what it's got going. What will be cut will be the development of new initiatives.
Your plan for 2027
Alex Cullen Vice president and research director, Forrester Research
An effective IT strategic plan is context-based, purpose-driven, change-focused and compatible with an organisation's culture and practices. So what's the context for 2027?
First of all, businesses are completely digitised-process automation is complete and business users can directly configure process changes. Business teams will be able to construct their own IT environments using services and tools they source either from the Internet or from their IT organisation. Technology will no longer be seen as a source of competitive advantage because it is so completely intertwined with business operations that it's impossible to talk about it separately. Competitive advantage will come from business models, practices and customer perceptions, with technology as a given.
Although IT departments will still be responsible for support for some legacy systems, their primary value will be advising and supporting business areas using their self-managed environments.
Oh, and the very last Cobol programmer will have just retired.
The IT strategic plan for a firm in this context might cover the following:
Strengthening IT's skills as advisers to these business teams. IT could emulate a concierge in a five-star hotel, anticipating the needs and being savvy to the operating styles of different business areas while helping them create the optimal information workplaces for their teams. Also, providing management control over the disposable IT workspaces business teams create and improving work-life balance now that there are virtually no boundaries between work systems and personal systems, and people are always available.
And don't forget continuing support for legacy applications now that there are no Cobol programmers left.
That's right, the IT strategic plan in 2027 will talk very little about technology.
The consumerisation of technology via Web 2.0 will put innovation in how business uses technology in the hands of business teams, not in the IT organisation as we know it. Technology innovations from vendors and open-source networks-such as new information sharing, collaboration and decision-making tools-will be promoted directly to and used by these business teams. The IT organisation's primary contribution to business innovation will not be today's R&D model but rather its role as a facilitator, consultant and information hub for these teams.
Staffing now for the future
Bob Worrall CIO, Sun Microsystems
With the IT industry poised to take advantage of more network-based, secure application services, the role of IT will change significantly. The traditional roles of applications developers and operations support staff will give way to roles such as vendor management, contracts administration and communications. Equally important, the business analyst will continue to be a vital role within the department. However, that role will focus less on the actual design of technological solutions and more on the definition of clear business requirements, which will be built and operated by trusted partners and delivered as services over the Internet.
Thomas M. Koulopoulos Founder, Delphi Group; executive director, Babson Centre for Business Innovation
We've barely laid the foundation for IT. The real innovation is just starting in four areas: on-demand computing, standardisation, open source and globalisation.
On-demand will provide IT as pure utility, ushering in an era of solutions rather than tools. The impact will be akin to the advent of power utilities in the era of industrialisation.
Standardisation will finally allow software components to work in a true architecture. Except for a few commodity providers, software megaplayers will be out of the software business.
As the first two innovations mature, open source will extend to an unimaginable scale, integrating innovations on a massive global grid.
Last, all of this will usher in the promise of globalisation. Remember, everything we see today in IT reflects less than 10 percent to 15 percent of global access to the Internet. At least five billion people still have no access of any sort to IT. We live and innovate in a sliver of humanity. Let's hope we can innovate IT to help the rest of us. Otherwise, can we really call it innovative?
An annotated time line: 2011 to 2023
Larry Niven author of Ringworld, coauthor of Lucifer's Hammer, A Mote in God's Eye and many others. Winner of five Hugo Awards and one Nebula Award for science fiction
2011: First attempt to attain civil rights for a computer program. Not taken seriously.
2020: Several programs are powerful enough to claim intelligence. First computer program to attain civil rights finds that it cannot survive without computers as housing. Computers are still human property.
2022: Property rights for programs.
2023: Computer programs own most of human wealth. The computer industry still includes human programmers, but managers and owners are all programs and subprograms.