IT Industry Set To Recover After Years In Doldrums

IT Industry Set To Recover After Years In Doldrums

With the industry contracting by 3% this year and 4% last year most of us are pleased to see that analysts are forecasting a recovery this year. Whether this recovery is just “because things will stop getting worse" as Ovum Holway describe it, or if it will actually be a real return to growth is as yet uncertain. What we do know though is that it wont be a return to the heady double digit growth rates of the late 90s.

IT directors are now very much wedded to obtaining maximum cost efficiencies and getting “more for less”. This will continue to drive the move to outsourcing and managed services. It will also drive yet more work on integration - trying to build better systems by better connecting what you already have. XML is likely to be an increasingly key tool here. "Proper" web services based around SOAP/UDDI are still relatively early stage, but just as much can be done for many companies with simpler RPC-XML technologies.

We also see wireless technology really beginning to break through. WiFi hot spots will become more prevalent and the ability to work at broadband speeds from the local coffee shop or in the living room will drive an increase in Virtual Private Network (VPN) adoption, and an increasing acceptance that wireless will soon be the norm, not the exception. 3G will still be a slow mover as businesses realise that GPRS delivers adequate speeds for most well designed mobile business applications - especially if WiFi is available at "pause points".
At the corporate level IT Governance is likely to become an increasingly serious issue, driven partly by legislation such as Sarbanes-Oxley. For those who aren’t aware Sarbanes-Oxley is a new piece of US post-Enron legislation designed to require more transparent and complete reporting by US companies - but is also expected to become a de facto requirement here. Separating IT governance from IT strategy will allow businesses, especially large corporates, to give due focus to issues like business continuity, security and reporting - whilst at the same time ensuring that IT delivery is flexible and aligned to the needs of the business and its operating units.

The Business Process Outsourcing and offshore bandwagons will continue to roll. Again separating IT governance from IT strategy and implementation will make it easier for companies to adopt these options whilst still retaining the required level of control. For smaller companies ASP solutions increasingly offer a cost effective way to outsource certain elements of their IT operations. It's almost as though we've forgiven the ASP industry the sins committed by it (or attributed to it) during the dot com boom and bomb

In the Midlands the work to grow a strong ICT community will continue to gather pace. With the creation of a regional IT association (WMITA), technology transfer projects such as iCentrum, an overall ICT strategy being promoted by the regional development agency (AWM) through its ICT cluster work, and property developments such as the Blythe Valley Business Park and the technology corridors the Midlands is an increasingly great place to be an IT company.

Finally what of the Internet, Broadband, e-commerce and e-business. Well as a recent speaker from BT told a Birmingham Future audience recently - “if you’re still talking about e-Business in a few years time your dead”. eBusiness really did ought to be becoming business as usual by now.