Gartner Group

Gartner demonstrates another roach on priorities. Gartner analysts came up with a list of major predictions that impacts enterprise businesses and how those predictions cross over technology, economics, and social boundaries that will morph during the next few years. The deep understanding of those priorities will impact the work and role of the CTO. We must clearly project where technology and business intersect and converge in the next scope of five to ten years. (32)

Bandwidth becomes more cost effective than computing

Network capacity will increase faster than computing, memory and storage capacity to produce a significant shift in the relative cost of remote versus local computing. Cheap and plentiful bandwidth will catalyze a move toward more centralized network services, using grid computing models and thin clients. Gartner bases this prediction on the fact that optical networking improvements are far outpacing growth in computer-related technology. The challenges of the last mile--security, quality of service, and grid economics--are barriers that need to be overcome.

Most major applications will be interenterprise This means that the evolution of applications and middleware is heading toward more adaptive software architectures that can be reconfigured on the fly with minimal hassle. This concept is the next evolution of the software model that has spawned ERP suites, portals, CRM, and supply chain applications that span across various constituencies involved in an economic ecosystem. This is the promise of Web services, and if they ever mature, we will have more of a plug-and-play capability for configuring applications. But we have already been through eras in which applications would seamlessly resolve into interoperable parts. Initiatives for industry-specific XML standards need to take root as well as other Web services standards.

Macroecomonic boost from interenterprise systems If most major applications moving to interenterprise comes to fruition, the overall economy would reflect a major upswing into productivity and efficiency. The logic suggests that corporations closely aligned through industry segment or some other value chain should actually see increased productivity that would flow to the macro-economy. The savings and increased productivity that would result would be clearly evident in government adopted business process and technology architecture.

Successful firms in strong economys lay off millions Given that productivity improvement from IT improvements suggested in predictions that previous trends would come to fruition and healthy profit margins, Gartner envisions a shrinking workforce. The concept is that like the agrarian industry, technology will reach a point where IT system automation substantially lowers the labor requirements. Gartner's strategic planning assumption is that enterprises transformed by the Internet are 70 percent likely to have 10 percent fewer workers by 2005 and 60 percent likely to have 30 percent fewer workers by 2010.

Continued consolidation of vendors in many segments Gartner predicts that at least one major player from most segments will disappear by 2004 through extinction or consolidation. That's not a risky prediction. As more of the smaller com companies evaporate, the major players will consume the smaller fish. At some point our industry will enter a period of oligopoly, in which a few vendors dominate the enterprise landscape, and that by 2007 the innovation and growth cycle will return.

Moore's Law continues to hold true through this decade Gartner gives Moore's Law, which posits that processor power doubles every 18 months, a 70 percent chance to continue unabated through 2011. Gartner projects that by 2008 the typical desktop computer will have 4 to 8 CPUs running at 40 GHz, 4 to 12 gigabytes of RAM, 1.5 terabytes of storage, and 100Gbit LAN technology. By 2011, processors will clock at 150 GHz and 6 terabytes of storage will be common. And, there are numerous technologies such as nanotube transistors and spintronics that could jump the next hurdle when CMOS reaches the end of its run.

Large banks become primary providers of presence services by 2007 Presence services can manage your preferences, personal information and experience on the Internet. Gartner considers what it calls "one-click Internet" as essential to bringing convenience and mobility to the Internet. Microsoft (Passport), the Liberty Alliance, AOL, and Yahoo (among others) are vying for a piece of your presence--if not all of it. But Gartner has said that the future belongs to independent companies or financial service provides, such as the banks. Banks have had to deal with security, privacy and issues of trust for centuries, and that legacy is particularly relevant in the digital age. Gartner gives the banks a 70 percent chance of succeeding in the presence business by 2007. Gartner predicts that the banks will play a major role and adopt something like Liberty or Passport as the underlying framework for the trust broker business.

Business activity monitoring is mainstream by 2007 BAM (business activity monitoring) is one of the hottest buzzwords making the round today. Garner clearly describes this as having automated sensors that provide the relevant information and context that leads to more effective, real-time decision-making. Gartner describes BAM as reshaping decision-making in the enterprise: "In the past, when enterprises made complex decisions, the answers were precooked because the information wasn't available at the point of contact between your business and customers. In the future, decision-making will be pushed down because of more real-time data and business processes throughout the enterprise." This concept fits neatly with prediction 2--tighter linkage across enterprises and industry value chains. Without BAM, organizations will fall on their faces trying to do business in real-time, which will be a requirement in many areas of business in the coming decade.

Business units, not IT, will make most application decisions The Gartner take is that business units, rather than a centralized IT department, will make decisions on business applications. By 2007, this trend has a 70 percent probability of governing purchasing in 65 percent of enterprises. The downside is that the overall benefits of IT expenditures will degrade. Accounting and business principles will define whether IT expenditures provide the necessary ROI. Applications will be grouped into three categories, according to Garner. First, basic utility applications will keep the business functions. Second, enhancement applications will provide some measurable ROI. And third, frontier applications, although more risky, can give a company a significant competitive edge. Gartner said that empowering business units is a good fit with decentralized organizations and delegated authority. Well-organized, decentralized organizations in volatile markets typically have the advantage of faster decision response time, and result in better business outcomes despite inefficiencies resulting from decentralized IT decision-making. The entire process works best if parties from both camps are involved in decisions and collectively understand the business goals.

Pendulum swings back from centralized to decentralized Gartner predicts the focus on more centralized IT during this time of economic contraction will shift by 2004 to a more decentralized model. Business objectives outside of cost containment will drive decision-making to business units, where agility is a highly valued commodity and there is resurgence in economic growth. (32)