cio exposed: the latest forecast for management
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CIO Exposed: The Latest Forecast for Management
Tim Dillon Associate Vice President Research IDC Australia
Copyright 2008 IDC Reproduction is forbidden unless authorized.
All rights reserved.
Copyright 2008 IDC. Reproduction is forbidden unless authorized. All rights reserved.
Forecast for Management 2008Forecast for Management 2008
Tim DillonAVP ResearchIDC Australia
August 2008
©2008 IDC 3
What’s in the Deck?What’s in the Deck?
The Economy
CIO Themes What does the CEO think about IT? IT Budget Allocations IT Spending
CIO Challenges The Digital Universe The annual Top Ten IT Staffing
Future Intent The CIO Radar for the next 12 months The CIO Shopping Cart for 2009
In Summary
©2008 IDC 4
The Economic EnvironmentThe Economic EnvironmentThe Economic EnvironmentThe Economic Environment
©2008 IDC 5
The Economic Environment : The Economic Environment : Rising Inflation, Declining IncomeRising Inflation, Declining IncomeThe Economic Environment : The Economic Environment : Rising Inflation, Declining IncomeRising Inflation, Declining Income
Source: EIU, July 2008
0
5
10
15
20
25
VIETNAM
INDONESIA
THAILAND
INDIA
PHILIP
PINES
CHINA
HONG KONG
MALA
YSIA
SINGAPORE
AUSTRALIA
KOREA
NEW Z
EALAND
TAIWAN
JAPAN
-2
0
2
4
6
8
10
Inflation 2007 Inflation 2008
Change in Disposable Income 2007 Change in Disposable Income 2008
Infl
ati
on
(C
ha
ng
e i
n C
PI)
%
Ch
an
ge
in
Dis
po
sa
ble
In
co
me
%
Change in Disposable Income 2009
©2008 IDC 6
The Economic Environment :The Economic Environment :History RepeatsHistory RepeatsThe Economic Environment :The Economic Environment :History RepeatsHistory Repeats
©2008 IDC 7
1990
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The Economic Environment : The Economic Environment : The Australian ViewThe Australian View
Dot Com Crash
©2008 IDC 8
The Economic Environment :The Economic Environment :Alternative Sourcing Arrangements…Alternative Sourcing Arrangements…
0
1
2
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1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2008
IT Spend as a % of Turnover
IT Spend as a % of Operating Expense
IT Spend outside of IS Budget (% revenue)
©2008 IDC 9
Introducing IDC’s Annual Introducing IDC’s Annual Forecast for Management SurveyForecast for Management Survey
NSW
New Zealand
Victoria
Queensland
Western Aust
ACT, NT, SA & Tas
Random sampling of 363 IT Executives across Australia & New Zealand:
Response by Geographical Segment:NSW - 32%New Zealand -30%Victoria - 13%Queensland 8%Western Australia – 7%ACT, SA, NT & Tasmania -10%
Response by Industry Sector:Finance & Business Services -25%Distribution -24%Public Sector - 20%Leisure & others - 16%Production -15%
©2008 IDC 10
CIO Themes in 2008CIO Themes in 2008
Themes
IT & Business SYNTHESIS
Corporate CITIZENSHIP
INFORMATION is Power
OPERATIONAL Excellence
CUSTOMER is King
©2008 IDC 11
The Good News: The Good News: What CEOs Think of ITWhat CEOs Think of IT
0%
10%
20%
30%
40%
50%
60%
70%
80%
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Contributed toOperationalCapability
Source OfCompetitiveAdvantage
Mixed Record inIT Investments
Disappointed inIT InvestmentReturns
©2008 IDC 12
Back to the Basics:Back to the Basics:“ Show me the Money! ”“ Show me the Money! ”
©2008 IDC 13
IT Budget Allocation & OutlookIT Budget Allocation & Outlook
0%
5%
10%
15%
20%
25%
30%
35%
Last Period (2007)
Current Period (2008)
Next Period (2009)
©2008 IDC 14
Where Did it all Go?Where Did it all Go?2007 Spending2007 Spending
10
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2
1
Bio-metrics technology
Smart cards
Storage over IP and/or iSCSI
Services Oriented Architecture
IP Surveillance
Radio Frequency ID Tags
Mobile IP
Voice and/or voice over IP
Videoconferencing
Data warehousing / Business Intelligence
©2008 IDC 15
ROI TimeframesROI Timeframes
ROI Timeframes for IT
Under 1 year
1-2 years
2-3 years
3-4 years
4-5 years
Over 5 years
Don't know
©2008 IDC 16
CIO ChallengesCIO Challenges
©2008 IDC 17
The Growth in Data : The Growth in Data : The Digital UniverseThe Digital UniverseThe Growth in Data : The Growth in Data : The Digital UniverseThe Digital Universe
IDC’s forecast of the digital universe – ie. All the digital data created throughout the globe
First published March 2007; Updated March 2008
Not just about numbers – focuses upon the implications for organisations.
©2008 IDC 18
The Growth in Data : Digital Universe The Growth in Data : Digital Universe Complexity, Confusion & ComplianceComplexity, Confusion & ComplianceThe Growth in Data : Digital Universe The Growth in Data : Digital Universe Complexity, Confusion & ComplianceComplexity, Confusion & Compliance
2007 Study 2008 Study
Data Created 161 Exabytes in 2006 281 Exabytes in 2007
Forecast 988 Exabytes in 2010 1,800 Exabytes in 2011
Creation 70% data created by Individuals
70% data created by Individuals – 50% real, 50% ‘digital shadow’
Geographically speaking
AP low, EU/US High AP rapidly growing in share of content created
Storage In 2007 we create more than we can store
By 2011, half of what we create won’t be stored
Compliance 85% of data created the responsibility of organisations
85% of data created the responsibility of organisations
Vertical Industries TV & Media, Finance TV/Media, Finance, Manufacturing, Retail, Transport, Utilities, Oil/Gas, Government
©2008 IDC 19
The Growth in Data :The Growth in Data :ImplicationsImplicationsThe Growth in Data :The Growth in Data :ImplicationsImplications
Companies face dramatic changes in how they:
Manage Growth – Revenue, Information & Infrastructure
Manage Risk – Data Security, Information Compliance
Manage Effectiveness – Operational Flexibility & Efficiencies
Create New Value – Customers, Markets, Solutions
Time searching for info (hours/week)
5.3
7.3
0
1
2
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Internalinformation
Externalinformation
Time wasted
Time searching
Time searching for info (hours/week)
5.3
7.3
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1
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Internalinformation
Externalinformation
Time wasted
Time searching
©2008 IDC 20
The Growth in Data : The Growth in Data : Digital ShadowDigital ShadowThe Growth in Data : The Growth in Data : Digital ShadowDigital Shadow
“You have zero privacy anyway …Get Over it” – Scott McNealy, 1999.
Approximately 50% of the information relating to an individual is created by that individual
The remainder is ‘ambient’ content – ie. Digital images on a security camera, information on web searches/browsing; banking databases, etc
Potentially positive implications around tailored services delivery
Major potentially negative implications around security
Either way, significant impact upon Organisations
©2008 IDC 21
The Growth in Data : The Growth in Data : How to Adapt . . .How to Adapt . . .
©2008 IDC 22
The Growth in Data : The Growth in Data : How to Adapt . . .How to Adapt . . .
©2008 IDC 23
CIO Challenges CIO Challenges CIO Challenges CIO Challenges
2008 2007 2006 2005 2004 2003 2002 2001 1996 Change
Reducing costs 1 1 2 2 1 1 1 2 5 4
Meeting users' expectations 2 3 4 4 4 4 4 3 2 0
Developing business case for IT 3 11 10 7 7 7 5 1 1 -2
Keeping abreast of technology 4 5 3 3 13 8 7 4 3 -1
New hardware/software 5 2 1 1 2 3 3 8 7 2
Recruiting and retaining staff 6 6 12 18 15 19 15 16 18 12
Aligning IT with the business 7 4 5 8 3 2 2 9 4 -3
IT staff skills development 8 12 14 13 9 15 10 13 9 1
Manage change/migration 9 7 6 5 5 5 6 6 10 1
Information security 10 17 7 6 6 6 8 17 15 5
©2008 IDC 24
IT StaffingIT Staffing
02468
1012141618
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Operating Period
% s
taff
turn
over Australia
NZ
All survey
Large Orgs
©2008 IDC 25
Top 5 IT Skills in DemandTop 5 IT Skills in Demand
0%
2%
4%
6%
8%
10%
12%
14%
Networking IT ServiceManagement
Help desksupport
Database Enterpriseapplications
©2008 IDC 26
CIOs Wish ListCIOs Wish List
©2008 IDC 27
What’s on the Radar for CIOs What’s on the Radar for CIOs in the next 12 months?in the next 12 months?
Business issues that will take priority in the next 12 months:
1. Improve infrastructure of our organization to increase productivity.
2. Improve customer service.
3. Introduce new and/or improved products & services at a faster rate / innovation
4. Gain a better understanding of our customers' requirements
IT Investment that will take priority in the next 12 months:
1. Collaborative Technologies and Knowledge Management (email, document management etc.)
2. Systems Infrastructure (security, storage, network, middleware, serverware etc).
3. Back office: e.g.: Enterprise Resource Management (ERP).
4. Business Intelligence e.g.: Data Warehouse or Data Mart.
©2008 IDC 28
The CIO Shopping Cart in 2009The CIO Shopping Cart in 2009
Technology/Discipline% Actual in use
at start 2008% Forecast use
by start 2010
% Forecast Change in Use - 2008 to start
2010Corporate citizenship 12% 17% 39%Enterprise Architecture Modelling Tool 15% 21% 38%ITIL (Information Technology Library) 18% 24% 32%Virtualisation (eg, VMWare, etc) 22% 28% 30%Green IT Policies & Procedures 27% 33% 24%Workflow management systems 33% 40% 19%ERP / Integrated systems 38% 45% 19%IT services qualification 23% 27% 18%Supply chain management systems 31% 36% 18%Charge back cost recovery for IT services 19% 22% 17%Sales force automation tools & marketing management 31% 36% 13%Online Training, eLearning 33% 37% 13%Document management 60% 67% 11%Customer relationship management systems 44% 48% 9%Benchmarking with external organisations 25% 27% 8%
©2008 IDC 29
In Summary : In Summary : The Business Impact The Business Impact
The expected slower economic growth indicates the need to aggressively focus on
share of wallet & sales-oriented projects
Strategic projects will emerge with the desire to seed for longer term competitive
advantage
Separating the ‘old’ and ‘new age’ corporate stakeholders/decision makers is
critical to effectively position new ITC Services and Deployments
The ‘old’ tends to focus on ‘business as usual’ and traditional ROI
The ‘new age’ wants to see technology ties to business (processes & metrics)
Enterprise 2.0 is at its beginning ‘corporate’ phase, users have already started ‘a
long time ago’
©2008 IDC 30
tdillon@idc.com
Thank YouThank YouThank YouThank You
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