Ten trends you cannot ignore

Vice-president of Nucleus Research, Rebecca Wetteman, counts down 10 issues which should be top of the IT agenda.

Vice-president of Nucleus Research, Rebecca Wetteman, counts down 10 issues which should be top of the IT agenda. 

1 Oracle and IBM are the last ones standing

Just like the political map, the software competitive map is breaking down to Oracle red and IBM blue. How will remaining standalone analytics, enterprise application, integration, and other technology suppliers weather 2011? With IBM and Oracle's energetic moves to secure dance partners, Microsoft needs to freshen its image and SAP's still doing the "Robot" dance. Suppliers that haven't formed partnerships with Oracle or IBM should look quickly to do so, or they may find themselves without customers when the dance is over.

2 Steve Ballmer must go

We know Bill Gates – and Steve, you are no Bill Gates. How does a software supplier move from a synonym for innovation to an also-ran competitor in more markets than any other? Don't ask Bill. Although many Microsoft divisions (such as Dynamics) continue to deliver, they are tarnished, not aided, by corporate missteps and a visionary vacuum. Microsoft is at a turning point: the company needs an inspiring visionary or a tactical general or both - and Ballmer is neither.

3 There are still small suppliers to consider

There are still small software suppliers out there that have developed specialised expertise and deliver significant value to customers. They have grown even in the downturn not by just filling gaps but by offering deep expertise in specific areas. These small suppliers have blue chip clients, unique skills, greater flexibility (being privately held), and a focus on customer success that delivers initial and ongoing ROI

4 Google: Grow up or be left to Google yourself

We'd all agree that Google has delivered some great technology innovations. However, as a glance through YouTube will tell you, just because you can do something doesn't mean you should. Beyond search (where Microsoft is encroaching), Google is in trouble. Its attention span can't make it through a product roadmap, and decision makers want predictable planning, not a supplier that's still trying to work out its attention deficit hyperactivity (ADHD) medication.

5 An uphill battle for HP

While the HP garage may have been restored, the rest of the company needs an overhaul. While old hippies were okay in the 1980s and managed in the 1990s, what do they do now? With its real strengths in hardware, and especially printers, Hewlett-Packard needs to get beyond boardroom scuffles and define what it is in the modern software world. Time will tell if HP can establish a new direction in 2011, but few who know SAP and new CEO Léo Apotheker's strengths bet he's the man to bring HP back to greatness.

6 SAP shrinks

SAP will continue to battle it out on the sales front, but the reality is that business intelligence (from the Business Objects acquisition) is the feeding tube keeping the old man alive. As customers contemplate costly upgrades or inflexible maintenance, and others consolidate to be more agile, SAP has no new generation to offer. The duct tape and shoestring fixes are unrealistic, and companies now have credible alternatives (Oracle, NetSuite, and others).

7. It's official: Politicians are stupid

Since the adoption of the internet (or perhaps even the telephone), modernists have declared government bodies out of touch with the realities of information technology. In 2011 more than ever, any money-hungry bureaucracy with out-of-touch taxing and fining powers will have to answer for their actions or suffer the consequences. It's easy for bureaucracy to scare companies away; it's much harder to attract them back. If the cloud enables white-collar workers to work anywhere, smart companies will look for environments with low taxes, health care costs, and other overheads. Governments and taxing authorities will need to think carefully about how they tax companies as real work locations become more virtual and companies leverage the opportunities of a global transient work force.

8. No more social networking nonsense

Twitter is for tweeting twits. We unfriended Facebook before the movie came out. Although social networking drove some interesting collaboration adoption in enterprises, most real workers are moving away from social sites. Instead, we find them on LinkedIn, a site that actually has something to do with their knowledge of business contacts and clients. In all fairness, some social networking technologies are delivering benefits, but as we showed last year, if you're not blocking Facebook you're losing 1.5% of total office productivity.

9. The cloud changes everything – again

Cloud is cheap, cloud is green, cloud is a marketing machine. In 2009, the cloud drove decisions and deployments outside of IT, user adoption of CRM and other applications, and panic about IT irrelevance. This year brought development environments in the cloud, a better understanding of cloud economics, and an enthusiastic leap - marketing or otherwise - on the cloud bandwagon for every major supplier. In 2011, look for greater competition in the cloud space, more and more upstart cloud app suppliers that leapfrog traditional startup delivery models, and more recognition of the real impact of the cloud on the environment. Anyone who says enterprises are skeptical about cloud computing are likely viewing all the supplier marketing hype for what much of it is: hype. However, the reality is that companies large and small are taking advantage of the economic and environmental advantages of developing and computing in the cloud. Suppliers, for their part, recognise that getting users onboard today is key, as competition drives price erosion, and long-term deals are best.

10. AT&T didn't hear us

AT&T's iPhone blunders with Twitter taught us a valuable lesson. We all know they have marginal service but most customers have, in the past, been left complaining on their own. When those unhappy customers can band together on the internet and take on a herd mentality, they can bring down partnerships and drive market changes. The internet allowed a collective voice to roar that AT&T was too slow to recognise. All suppliers beware: an auto response to a negative tweet is not customer service. Don't let a single voice move a herd.


Article by Rebecca Wettemann and the Nucleus team.

Nucleus Research Inc. is a leading provider of investigative information technology research and advisory services. Its analysts deliver insight and guidance to help clients make the best decisions. Advising both suppliers of technology and the organizations that use technology, Nucleus Research specialises in uncovering information that no one else can provide.

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