Did IT innovation deliver in 2012?

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As 2012 comes to an end, 4C Associates looks back at some of the predictions made earlier this year. Ian Lund considers prediction number nine: “There will be tremendous innovation in IT requiring new skills to manage,” and 10: “This year the CEO starts to look at IT costs, forcing measurement of the business value delivered by innovation.”

Back in February, 4C Associates predicted that there would be a shift in IT from centrally provided corporate services to individually consumed applications.  Innovations such as cloud computing, Google Apps and Bring Your Own Device (BYOD) have the potential to fundamentally change the cost structure of IT.  Companies which keep abreast of the latest solutions and effectively manage their strategic suppliers to ensure these innovations deliver their full value, will be able to benefit from a considerable cost advantage.

The Coming of Age

2012 saw organisations adopt each of the innovations cited above.  There was a particularly rapid implementation of BYOD. The Cisco IBSG Horizons Study of 600 U.S. IT and business leaders, reported that 95 per cent of respondents said their companies allow employee-owned devices in some form in the workplace.

Organisations also pushed their non-critical applications on to public cloud offerings such as Amazon EC2, and prepared strategies for private and hybrid clouds for their more critical systems.  For example, the UK Government launched the G-Cloud, and the associated Cloudstore catalogue of approved services.

Earlier this year, Gartner Inc. estimated that infrastructure as a service will be the fastest growing cloud sector with predicted growth of 45 per cent in 2012. Software as a Service (SaaS) became a fundamental element of IT strategies and architectures, while Open Source infrastructure tools broke into the mainstream market.

2012 was also the year in which many organisations rejected the full integration model offered by larger software vendors, in favour of best-of-breed IT strategies, incorporating relevant innovations.

Innovation is Driving a Requirement for New Skills

Organisations need to focus on IT strategies which manage the integration of SaaS with conventional applications, and the integration of their in-house platforms with Infrastructure as a Service components, such as cloud.

IT departments are under increasing pressure from CEOs and CFOs, who are not seeing low unit costs translate into overall reductions in expenditure.  If integration requirements are not taken into consideration when selecting solutions, the resulting costs can negate any advantages gained by lower unit pricing.

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