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The 2006 Summit Seven: Dynamic Computing Delivers Business Value

    Online News published in DMReview.com
January 16, 2006

Each year, Summit Strategies compiles an annual list of seven IT industry inflection points that we believe will have the largest impact on the IT vendor community in the upcoming year. To make the list, each opportunity/challenge has to be more than a popular upcoming buzzword or trend. It must be capable of forming an inflection point - a market or industry shift that a vendor or their on-the-ball competitors will use over the next year to create an advantage in selling into accounts or to change rules of competition. These are changes that no vendor can afford to ignore.

As in past years, the dynamic computing theme is a common thread in our lists - and in our current and upcoming research. Dynamic computing is the direction to which all IT environments are going to migrate and the way in which IT is going to fulfill its long-term promise of being an enabler to - rather than being an inhibitor to - business.

Our Summit Seven key inflection points for 2006 are:

1. Business-Based Value Propositions Start to Trump IT-Based Value Propositions. Customers have spoken - IT solutions are not enough. They must solve actual business needs. Vendors are getting the message. They are going beyond platitudes and beginning to deliver true business value.

2. A Gathering Perfect Storm Threatens IT Industry Economic Models. Although falling prices have been a constant in the IT industry, we are now faced with a perfect storm. Extraordinary new pressures are simultaneously buffeting hardware, software and services - depriving even the most diversified of vendors a safe harbor.

3. Emergence of a New Software Industry Order. While the software industry is reeling from many fundamental changes, none is as profound as the emergence of services-enabled software. This transformation will redefine the entire software industry.

4. Information Supersedes Technology as Primary "IT" Focus. No longer focusing on technology for its own sake, customers are beginning to make digitized information a centerpiece of their IT strategies. They are looking for better ways to capture, manage, protect and leverage their information assets.

5. Offshore Pressures Darken the Future of IT Services Industry. The expanding use of offshore services will lead many traditional services and systems integration firms to contemplate how - and if - they can maintain their current operating models in 2006. This sets the stage for some potentially dramatic changes in the makeup of the services industry in future years.

6. CIOs Get Business Value Religion. Leading-edge CIOs will implement sophisticated, business-focused IT governance processes and tools to increase their credibility with internal business sponsors and free up funding to support strategic business/IT initiatives.

7. BPO 2.0 and Beyond: Control Shifts from Outsourcers to ISVs. BPO offerings are undergoing three transformations that will gradually shift market power and value-add from services providers to application vendors - unless outsourcers can grow two key capabilities.

Although the following items didn't quite make the cut for inclusion in our top seven, these FutureWatch items hold the potential to exert considerable industry impact over time. On our 2006 FutureWatch are: Wall Dividing Development from Run-Time Begins to Collapse; RFID and the Rise of the Machines; and Ecosystems Make or Break Vendors' Mid-Market Strategies.

For more information on related topics visit the following related portals...
Benchmarking/Best Practices.

This piece has been brought to you by the DM Review Editorial staff.

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