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Top Predictions for IT Organizations and Users for 2012 and Beyond - A Gartner study

PCQ Bureau

02 Dec 2011 10:44 IST

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Gartner has revealed its top predictions for IT organizations and
users for 2012 and beyond. Analysts said that the predictions
herald
changes in control for IT organizations as budgets, technologies
and
costs become more fluid and distributed.

This year's selection process included evaluating several
criteria
that define a top prediction. The issues examined included
relevance,
impact and audience appeal. A list of this year's predicts reports
is
available on the Gartner Predicts href="http://www.gartner.com/predicts">website color="#1f497d">.

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Gartner's top predictions for 2012 and beyond showcase the trends
and events that will change the nature of business today and in
years
to come. Selected from across Gartner's research areas as the most
compelling and critical predictions, the trends and topics they
address underline the reduction of control that IT has over the
forces that affect it.

"The continued trends toward consumerization and cloud
computing highlight the movement of certain former IT
responsibilities into the hands of others," said Daryl Plummer,
managing vice president and Gartner fellow. "As users take more
control of the devices they will use, business managers are taking
more control of the budgets IT organizations have watched shift
over
the last few years. As the world of IT moves forward, CIOs are
finding that they must coordinate their activities in a much wider
scope than they once controlled. While this might be a difficult
prospect for IT departments, they must now adapt or be swept
aside."

Gartner analysts said that going into 2012 there is an increase
in
the amount of information available to organizations, but it's a
challenge for them to understand it. Given the shifts in control
of
systems that IT organizations are facing, the loss of ability to
guarantee consistency and effectiveness of data will leave many
struggling to prevent their organizations from missing key
opportunities or from using questionable information for strategic
decisions. No regulatory help is on the near horizon, leaving each
business to decide for itself how to handle the introduction of
big
data.

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"Any organization which wishes to accelerate in 2012 must
establish in itself a significant discipline of coordinating
distributed activities," Plummer said. "They must
establish relationship management as a key skill and train their
people accordingly. The reason for this is that the lack of
control
can only be combated through coordinative activities. The IT
organization of the future must coordinate those who have the
money,
those who deliver the services, those who secure the data, and
those
consumers who demand to set their own pace for use of IT."

Gartner's top predictions for 2012

By 2015, low-cost cloud services will cannibalize up to 15
percent of top outsourcing players' revenue.

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Industrialized low-cost IT services (ILCS) is an emerging market
force that will alter the common perceptions of pricing and value
of
IT services. In the next three to five years, this new model will
reset the value proposition of IT. Low-cost cloud services will
cause
the cannibalization of current and potential outsourcing revenue.
Similar to what happened with the adoption of offshore delivery,
it
will be incumbent upon vendors to invest in and adopt a new
cloud-based, industrialized services strategy either directly or
indirectly, internally or externally. The projected $1 trillion IT
services market is at the beginning of a phase of color="#000000">further
disruption, similar to the one the low-cost airlines have
brought in the transportation industry.

In 2013, the investment bubble will burst for consumer social
networks, and for enterprise social software companies in 2014.

Vendors in the consumer social network space are competing with
each other at a rate and pace that are unusually aggressive, even
in
the technology market. The net result is a large crop of vendors
with
overlapping features competing for a finite audience. In the
enterprise market, many small independent social networking
vendors
are struggling to reach critical mass at a time when market
consolidation is starting, and megavendors, such as Microsoft,
IBM,
Oracle, Google and VMware, have made substantial efforts to
penetrate
the enterprise social networking market. While substantial
excitement
will be raised by private firms going public, valuations of
smaller
independent vendors will diminish as recognition sets in that the
opportunities for market differentiation and fast growth has
eroded.

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By 2016, at least 50 percent of enterprise email users will
rely primarily on a browser, tablet or mobile client instead of
a
desktop client.

While the rise in popularity of mobile devices and the growing
comfort with browser use for enterprise applications preordains a
richer mix of email clients and access mechanisms, the pace of
change
over the next four years will be breathtaking. Email system
vendors
are also likely to build mobile clients for a diverse set of
devices
for the same reason. Market opportunities for mobile device
management platform vendors will soar. Increased pressure will be
on
those suppliers to accommodate an increasing portfolio of
collaboration services, including instant messaging, Web
conferencing, social networking and shared workspaces.

By 2015, mobile application development projects targeting
smartphones and tablets will outnumber native PC projects by a
ratio
of 4-to-1.

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Smartphones and tablets represent more than 90 percent of the new
net growth in device adoption for the coming four years, and
increasing application platform capability across all classes of
mobile phones is spurring a new frontier of innovation,
particularly
where mobile capabilities can be integrated with location,
presence
and social information to enhance the usefulness. Innovation is
moving to the edge for mobile devices; whereas, in 2011, Gartner
estimates that app development projects targeting PCs to be on par
with mobile development. Future adoption will triple from 4Q10 to
1Q14, and will result in the vast majority of client-side
applications being mobile only or mobile first for these devices.

By 2016, 40 percent of enterprises will make proof of
independent security testing a precondition for using any type
of
cloud service.

While enterprises are evaluating the potential cloud benefits in
terms of management simplicity, economies of scale and workforce
optimization, it is equally critical that they carefully evaluate
cloud services for their ability to resist security threats and
attacks. Inspectors' certifications will eventually become a
viable
alternative or complement to third-party testing. This means that
instead of requesting that a third-party security vendor conduct
testing on the enterprise's behalf, the enterprise will be
satisfied
by a cloud provider's certificate stating that a reputable
third-party security vendor has already tested its applications.

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At year-end 2016, more than 50 percent of Global 1000
companies
will have stored customer-sensitive data in the public cloud.

With the current global economy facing financial pressure,
organizations are compelled to reduce operational costs and
streamline their efficiency. Responding to this imperative, it is
estimated that more than 20 percent of organizations have already
begun to selectively store their customer-sensitive data in a
hybrid
architecture that is a combined deployment of their on-premises
solution with a private and/or public cloud provider in 2011.

By 2015, 35 percent of enterprise IT expenditures for most
organizations will be managed outside the IT department's
budget.

Next generation digital enterprises are being driven by a new
wave
of business managers and individual employees who no longer need
technology to be contextualized for them by an IT department.
These
people are demanding control over the IT expenditure required to
evolve the organization within the confines of their roles and
responsibilities. CIOs will see some of their current budget
simply
reallocated to other areas of the business. In other cases, IT
projects will be redefined as business projects with
line-of-business
managers in control.

By 2014, 20 percent of Asia-sourced finished goods and
assemblies consumed in the U.S. will shift to the Americas.
Political, environmental, economic and
supply
chain risks are causing many companies serving the U.S. market
to
shift sources of supply from Asia to the Americas, including
Latin
America, Canada and the U.S. Except in cases where there is a
unique
manufacturing process or product intellectual property, most
products
are candidates to be relocated. Escalating oil prices globally
and
rising wages in many offshore markets, plus the hidden costs
associated with offshore outsourcing, erode the cost savings
that
didn't account for critical supply chain factors, such as
inventory
carrying costs, lead times, demand variability and product
quality.

Through 2016, the financial impact of cybercrime will grow 10
percent per year, due to the continuing discovery of new
vulnerabilities.

As IT delivery methods meet the demand for the use of cloud
services and employee-owned devices, new software vulnerabilities
will be introduced, and innovative attack paths will be developed
by
financially motivated attackers. The combination of new
vulnerabilities and more targeted attacks will lead to continued
growth in bottom-line financial impact because of successful cyber
attacks.

By 2015, the prices for 80 percent of cloud services will
include a global energy surcharge.

While cloud operators can make strategic decisions about
locations, tax subsidies are no long-term answer to managing
costs,
and investments in renewable-energy sources remain costly. Some
cloud
data center operators already include an energy surcharge in their
pricing package, and Gartner analysts believe this trend will
rapidly
escalate to include the majority of operators - driven by
competitive pressures and a "me too" approach. Business and
IT leaders and procurement specialists must expect to see energy
costs isolated and included as a variable element in future cloud
service contracts.

Through 2015, more than 85 percent of Fortune 500
organizations
will fail to effectively exploit big data for competitive
advantage.

Current trends in smart devices and growing Internet connectivity
are creating significant increases in the volume of data
available,
but the complexity, variety and velocity with which it is
delivered
combine to amplify the problem substantially beyond the simple
issues
of volume implied by the popular term "big data."
Collecting and analyzing the data is not enough - it must be
presented in a timely fashion so that decisions are made as a
direct
consequence that have a material impact on the productivity,
profitability or efficiency of the organization. Most
organizations
are ill prepared to address both the technical and management
challenges posed by big data; as a direct result, few will be able
to
effectively exploit this trend for competitive advantage.