Market Trends 2010: The Gartner View

2009 was a gruelling year for enterprises. The impact varied according to geographies and verticals. India was well immune to the jerks as compared to the US and Europe. As a consequence of the downturn, the world will be a different place in 2010. The degree of difference would depend on the kind of strategy that enterprises will adopt. “The success of enterprises in the post recession period will depend on their ability to strategise better alignment between IT and the business,” said Partha Iyengar, research VP, Gartner, while addressing the IBM Software Universe’ 09 in Mumbai.

Reiterating the Need for Business-IT Alignment

One of the critical parts of the strategy would be how articulately enterprises calculate their risk appetite. This would again depend on the country of operations and the industry vertical. After deciding on the risk, the IT moves should be made accordingly. Any mismatch of the stance taken on the risk appetite and the resultant IT initiatives could result in a disaster.

The other part of the strategy will be business decision makers focusing more on IT strategy and integrating it with the business strategy. Gartner is of a firm view that businesses should also weigh their performance on the business-IT alignment matrix.

As we move into 2010, businesses should know the answers to three basic questions:

1. Why is IT-Business integration indispensable?
2. How are enterprises achieving this integration?
3. What are the strategies to improve alignment of IT to the business?

Another emerging viewpoint would be fading away of the old world view of considering IT as a tool for running the organisation. IT will increasingly be used by organisations to ‘grow’ and ’transform’. This should also be a part of the IT-business alignment strategy.

IT should not only run, but also ‘grow’ and ’transform’ the organisation

It has been a traditional view that IT runs the organisation and thus, is highly commoditised. Gartner points out that in 2010, businesses should think about how IT can increase their focus not only on running the business but also ‘growing’ and ’transforming’ it.

While undergoing the growth stage prompted by external factors, IT should provide the required agility the business needs. Transformation includes adding capabilities to respond to external changes in the business environment. It can also be any potential change in the business model. Gartner has found that poorly performing enterprises have weak delivery practices. So if your enterprise is in the poor performing category, it is still not fit to plunge into either the ‘growth’ or ’transformation’ stage. The reason behind high performance companies doing well has been their adoption of ‘strategy’ best practices.

Enterprises should deal with spikiness swiftly

Iyengar said that the fundamental challenge before the enterprise community is to deal with the ‘spikiness’ in the business environment. “If IT continues on its usual smooth course, it will not be able to respond to the spikiness,” said Iyengar. Enterprises will also have to think on how swiftly they can respond to volatilities and spring back successfully.

According to Gartner, the emerging landscape will see companies gauging demand on the basis of the business performance in the past quarter or six months. The IT investments will be planned following the value provided by the investments in the immediate past. The focus on business risk of IT initiatives will remain though.