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Tuesday, May 16, 2006

IT As A Non Growth Industry!

In the run up to the Gartner symposium at Barcelona,Gartner's Ken McGee declaresIT is now a "non-growth industry" .He sees that with spending lagging behind general economic growth as user organisations lose faith in the returns on their tech investments. This trend, he warns could put the future of the CIO and the existence of the IT department under threat.Not sure whether this is plain sensationalism or based on careful analysis - while I await his presentation at Barcelona to get over,pending a full review, I want to point to Mckinsey's recent presentation that in developed countries, the more and more IT investments get directed towards supporting tacit transactions (this is around 40% of total transactional volume), the outcomes could be significantly different. As I wrote earlier, data from other sources -Forrester, CIO show increasing spend for the year forward. My today's scan shows that tech sector dominates VC investments in Ireland and I can say based on my extensive first hand insights into big markets like Japan, Australia,China & India that IT investments are definitely headed north. As of last year the total IT investments were in the region of $2.1 trillion dollars and the stakes are high to make these investments fetch better returns and technological changes and global competitive pressures are bound to make companies invest lot more in IT. Charles calls the reported findings of Ken as a result of goofy analysis. The fate of europe losing out is there for all to see. (I was in a conversation yesterday with the global head of sales of a fast growing software product company - and he had this to say while speaking in a different context- the lag between IT investments that used to be seen between the US and Europe is more or less gone) - such being the bullishness on IT investments, the connect looks weak. Shall come with an update post after getting a chance to review Ken's presentation in detail.

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
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