Six big questions for 2013

The big flaw in most of the IT predictions you will read at this time of year is that technology is no respecter of the calendar. Fast moving it may be, but it’s not as if the issues faced by IT leaders have changed suddenly since we all departed for the season of festive overeating.

For most IT professionals, the issues  for 2013 are not that different from those they faced in 2012 – managing or reducing budgets; delivering innovation; and explaining to business colleagues how to use IT to improve competitive advantage, productivity and customer service.

The three fastest developing technology trends will remain the same this year too – expect mobile / consumerisation, cloud and big data to appear frequently in the headlines, along with perennials such as information security.

But 2013 is likely to be a time when certain big questions affecting corporate IT are going to have to be answered. Here’s a personal rundown of six of the biggest:

What next for HP?

The world’s largest IT company is a mess. Despite annual revenue over $120bn, its market value is now less than $30bn – a figure less than it has spent on acquisitions over the past five years. Not only has HP destroyed the value in major purchases such as EDS, Palm and Autonomy, it has at the same time reduced its own value to less than it spent in the first place. That’s a phenomenal vote of no confidence from investors, let alone customers.

Years of musical chairs in the boardroom, ever-shifting strategy, unclear technology priorities, and vain attempts to maintain both a consumer and enterprise business, have put HP in a worryingly weak position. The latest CEO, former eBay chief Meg Whitman, is engaged in a “multi-year turnaround” plan, but investors are losing patience. Will HP conduct a fire sale, be broken up, or even itself be acquired this year? You can’t rule out any option.

Will Microsoft get it?

Microsoft remains the dominant supplier of enterprise IT software, and that’s not going to change in the course of 2013. But IT decision-makers want to see evidence that Redmond understands the fast-changing demands they are dealing with. Even some of the most loyal supporters of Microsoft these days agree that the company just doesn’t “get it” with the evolving IT landscape. If Windows 8 is meant to be the blueprint for how Microsoft will span the corporate and consumer worlds, then the supplier is no nearer to proving it will remain the inevitable choice for productivity, communications or collaboration.

Many CIOs are publicly declaring their desire to move away from Windows, stating that the forced move from XP to Windows 7 will be their last migration. Windows Server, Office, and Sharepoint will ensure a continued presence in the IT department, but as users increasingly see non-Windows interfaces in their day-to-day work, that long-held lock-in starts to evaporate and it becomes easier to move to alternatives. Microsoft’s influence will not go away in 2013, but the decisions the firm makes this year will determine how much longer that influence will continue.

Can the reformers in government IT win?

This is a pivotal time for the reform of government IT. In 2012, after much politicking (of both the small “p” and capital “P” varieties), important foundations were laid – the new digital strategy, the open standards policy, and the G-Cloud project, to name but three. But now those plans need to be turned into actions, with a further battle looming between departmental CIOs and the central Cabinet Office team.

A recent reorganisation of responsibilities has thrown the future of the CIO role into question – but will those CIOs be happy to simply roll over (or retire) and have their roles diminished? It’s unlikely. But the reform of government IT needs to be in place before the next election in 2015, and for that to happen, much progress is needed this year.

Can the UK become a world-leading digital economy?

For the last 15 years, successive prime ministers have made grandstanding speeches pledging that the UK’s future is as a world-leading digital economy. And to be fair, as a country we’ve not done too badly: we are the biggest online shoppers in Europe; we’re just about keeping up on high-speed broadband (unless you live in rural areas); and we have enthusiastically embraced all things mobile (even if we are rather late to the 4G party).

But these things have happened because of you and me, and not because of any policies put in place by those eager politicians. It’s all very well leaving digital progress to “the market” and consumer demand, but this is the new industrial revolution, not the latest fashion.

We need a government industrial policy for technology that puts in place a framework that incentivises global companies to base their cloud operations in the UK, and an environment in which UK digital businesses can thrive and not all end up acquired by overseas rivals. In particular, we need significant investment in the IT skills base, otherwise our essential digital skills will eventually be sourced from abroad.

Let’s not knock initiatives such as the cash going into Tech City in London, or the small hand-outs from the Technology Strategy Board to help fund new initiatives – but equally, let’s be honest and say they are a drop in the ocean; they should be peripheral initiatives supporting a broader plan for the digital economy.

We need the government this year to put in place real actions, not just words and pennies. As the financial services industry makes its slow but inevitable move to the East, we need to build the digital economy to replace it.

Can IT departments cope with the new tech-savvy user?

The era of the command-and-control IT department is dead – even if there are still plenty of examples that refuse to die. Consumerisation and bring your own device (BYOD) policies are here to stay, and will happen whether the IT manager wants them to or not. If you resist this wave, your inevitable successor will embrace it instead.

Forward-thinking IT leaders are redefining the relationship between IT and its internal customers. IT budgets no longer necessarily live in the IT department – marketing chiefs in particular are becoming increasingly influential as firms look to use social technology, the web and mobile to improve customer engagement.

For those IT departments determined to be digital King Canutes, and stick with their locked-down, process-controlled, “them and us” approach to users, this year will be one of your last.

Which businesses are ready to thrive in the internet era?

It’s now a statement of the obvious to say that whole industries are being transformed by the internet. No self-respecting CEO can deny that the web is changing their business, and in particular its relationship with customers.

But for many long-established, hitherto successful companies, the spectre of legacy IT holding them back looms large. If you look at most of the household name firms that are struggling, have disappeared or gone bust, then a failure to adapt to the web was central to their collapse – Comet, HMV, Woolworths, Kodak, Borders; the list is long and growing.

In industries such as entertainment or travel, new entrants are destroying old dominance because they have started from scratch with modern web technologies and don’t have an anchor in the mud of outdated legacy IT.

The big banks in particular face a huge dilemma – most have, at the heart of their IT, systems that were developed 10, 20 or even 30 years ago. Their hideously complex IT infrastructures are barely able to cope with online or mobile banking – look what happened to Royal Bank of Scotland and NatWest last year, when that combination of complexity and legacy brought the banks to their knees.

As the economy slowly, agonisingly recovers, the firms that thrive will be those that recognise the dramatic changes in customer behaviour brought about by technology, and invest in IT accordingly.

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