'Let go of the brakes'

What would be Lean IT’s fate next? Will buyers continue to rule the roost with IT shopping? Is it silly to expect the era of multi-bn dollar deals return? What mood and mandates is the Indian CIO up to? Well, when you want to smell the coffee and smell the roses as well, there’s no better nose to turn to than that of Andy Rowsell Jones, VP and Research Director, Gartner. Andy Jones was in India recently and he took some quick minutes out to share some shots from his dashboard telling us where the needle is going to turn next. Hop in.

Hi Andy. I will start with Gartner’s own trend-bin first. As to the technologies that will rule the next decade, Gartner pulled out some interesting predictions on the Top 10 strategically inclined technologies in Sydney recently. Among them we saw Advanced analytics, Flash Memory, Mobile Apps, Client Computing and Social Software, to name a few. Which ones do really hold hope in the Indian context?

Mobile area is a top priority for Indian CIOs. Comparing US and Indian markets, one will see that the need is same but the solution is different. In India it would be about simpler applications, affordable handsets, and best use of standard bandwidth and so on. The impetus is growing. In the area of social web too there are a lot of internal opportunities. Collaboration etc is a tip of the iceberg here.

Which technology in your estimate would be the next disruptive force that might throw the current staples out of kilter?

Cloud computing is certainly one. Social computing is another growing part of IT distribution, and it is an important and growing trend. On the long-term axis, advanced analytics and intelligence may take the cake. Interconnecting devices on network, spotting patterns in data, combining insight or tapping customer behavior patterns, all this will change a lot. I guess with handset sophistication and applications at corporate level, we may also witness many location and context-based services.

How about the open source species? Would the industry DNA change on that?

Open Source Tools are witnessing some interesting dynamics globally. In some cases, Oracle and SAP might encourage open source components. But I don’t see a big flow of spends to Open Source. For India, however, there’s a positive industrial policy, and from a government perspective there could be advantages here given the low-cost high-delivery models. Packaged software might be viewed as expensive in this context.

Last year saw many projects and spends konking off. Risk management, cost rationalization and Lean IT became the main levers. Would all that still stay put or would big-ticket spends come out of slumber?

Cost reduction and Lean IT were some real game changers. They are still valid but 2009 was different. It was dominated with a lot of brakes. Now the acceleration is on. And it’s time to accelerate again after the brakes have been used. If you can continue to do risk management etc with the new times, do it. But specially for Indian CIOs, do not 'brake' it. Not scaling it now, would be unforgivable.

One by-product of the rough ride was the turning of tables too. Buyers suddenly had a different negotiation muscle with the vendors. Would the same table manners remain?

Yes, last year, buyers had power. This year it would be supplier having power. It was a global trend when vendors offered new price levels. The time of freebies and giveaways has gone though. Because market has come back to growth. IT Budgets have come back and not only in India, but also in China and Hong Kong. Vendors can reasonable expect a comeback, so no pressure on them to keep the deals flowing.

How about jumbo deal tables? Will the era of multi-billion dollar size return?

I was incredulous at this thought, but there still are firms out there who want to spend like that. Yet, we really hit the heydays in 99 and such times are once-in-a-lifetime events. A lot of money was spent on application replacements, ERPs and packages. We might see that again. We might not. But people are still consolidating. So while a complete replay might not happen, changing platforms etc or a major revamp can give a déjà vu for sure.

Before we let you go, one last candid take on the degree of IT penetration or automation in India? Both on geography and sector dimensions.

It’s a hard question and there’s no simple answer. There is a natural level of information technology for any industry. In some markets, we find more sophisticated users. For instance, Australia. It depends on internal information order, State taxes, co-ordination levels, standardization, collaboration, economic incentives and a lot many other factors. Talking of industry segments, if your labour is cheap, then there is no point of automation or licences.

There are many under penetrated industries that way. Traditional areas like healthcare, cottage industries, education etc have a different degree of penetration. Yet in some regions in Asia, enterprises are still struggling to find the way. In India, it’s nice to see how segments like financial services, manufacturing, shipping; Pharma etc are expanding so quickly. Capacity growth puts the impetus back to CIOs. There are other comparisons like China etc. Indian CIOs are a tad better sophisticated customers. After the near-death experience in economy last year, many CIOs were affected with fear and were looking at freezing projects. From an acceleration stage they had to pause for brakes. But the job of CIOs has not changed a lot even though cost and growth definitions have changed.