A substantial recovery in information technology (IT) capital spending is increasingly likely in 2004, Michael Fleisher, chairman and chief executive officer of Gartner, Inc., announced at the annual ITxpo Gartner symposium held in Buena Vista, Florida.
Increasing numbers of corporate IT managers plan to replace aging equipment, apply new technologies to improve efficiency, and pursue new opportunities created by advances in open-source software and wireless communications, Fleisher said.
The IT spending recovery likely will accelerate moderately through 2005 and into 2006, he said. By then, several advancing technologies will converge to further accelerate spending as IT managers act on unprecedented new options to improve the flexibility, efficiency and profitability of many business processes, Fleisher said.
Fleisher discussed the future of the IT industry today in the keynote address opening at Gartner Symposium/ITxpo conference here.
"A big turn is coming," Fleisher told the Symposium/ITxpo audience. "We believe 2006 will look just as different when compared with 2003 as 2003 looks when compared with 1999. Companies are beginning to make the turn from protecting profitability to driving growth. Cost-cutting will remain important, but it will no longer be your CEO's No. 1 priority."
In his speech, Fleisher identified four specific technologies that corporate leaders, CEOs as well as CIOs, will embrace to support a renewed corporate emphasis on innovation to support business growth.
These technologies include secure broadband wireless, "always on, always connected" mobile devices with very low power-consumption requirements, very reliable and very cheap computing power provided by real-time enterprise infrastructure and a transition to service-oriented IT architectures.
"Just as the Internet unleashed productivity gains that revolutionized the securities, music and travel industries, the next wave of innovation triggered by these four technologies will be equally ground-breaking," Fleisher said.
"For example, the ability to wirelessly and continuously identify, verify and track physical devices will enable stunning efficiencies in transportation, logistics, distribution and retail," he said. "The combination of secure broadband wireless, electronic paper and very large, low-cost memory will have major consequences for the paper industry, media and advertising."
"IT professionals who understand and acquire the capabilities surrounding these technologies will clearly be in greatest demand," Fleisher said. "People who upgrade their skills and who understand how these skills can play into a larger business strategy will be very well rewarded."
Despite the downturn in IT spending in the past three years, many forward- thinking companies have applied several principles to effectively focus their IT budgets and projects on core business strategies. These principles include:
- Investigating the outsourcing of technology functions that are not strategic to their business
- Standardizing many elements of their core IT infrastructure, including processing speed, storage and networking
- Reducing the number of vendors and separate technologies for more efficient IT portfolio management
- Continuing to maintain control of IT strategic planning and architecture functions regardless of the scale and scope of their outsourcing programs
"IT organizations must be ready to support two distinct functions going forward," Fleisher concluded, "a continued vigilance around tightly managing costs and driving efficiency and support for your CEO's emerging No. 1 priority: innovation to drive growth."
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