Gartner: U.S. IT industry needs to wake up and smell the competition |
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By Linda Tucci, Senior News Writer
24 Apr 2007 | SearchCIO.com |
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SAN FRANCISCO -- The U.S. IT industry has settled for mediocrity. It lacks the vision, innovation and ambition to be a force in business growth.
"This industry is in imminent danger of becoming an industry of failure," said Stephen Prentice, managing vice president at Gartner Inc., one of the tough-talking keynote speakers at this week's Gartner Symposium/ITxpo, which attracted more than 2,000 IT professionals.
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You must have a China strategy.
Sandy Shen
analyst, Gartner Inc.
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As the delivery of technology becomes more flexible and IT functions are commoditized, companies increasingly will buy IT services, not products, said Peter Sondergaard, senior vice president of the Stamford, Conn.-based research firm. The evolution in the delivery of IT will cannibalize and eliminate some vendors and have major financial consequences for everyone -- and their families -- in the audience, he added.
IT providers must adapt or risk "sleeping with the servers."
IT is no longer a growing sector, according to Gartner -- India's staggering 16% annual growth notwithstanding. The growth rate for IT declined in both of the past two years and the trend is expected to continue for the next three years. In good times, the industry might be able to get away with doing less -- but not in a decline, Prentice said, citing another Gartner data point: "Tech is seen less and less as a force that can fuel business growth."
As in years past, the keynote included mini-orations by a team of Gartner analysts, but the warnings -- and customary soft sell for attending the conference -- were delivered with flair.
Gartner analyst Sandy Shen took the stage, speaking Mandarin, and announced that the "factory of the world" is fast becoming the "innovation factory." Chinese companies that have had to scale up to meet the needs of a rapidly growing market are "going full-steam ahead to innovate," Shen said. These companies have moved well beyond the low-cost model and will "eat your lunch," despite intellectual property protection issues, rising labor costs and other problems. "You must have a China strategy," she said.
Throwing political correctness to the wind, Prentice called out the telecom industry, comparing Sprint's memorable ads of yesteryear -- "quality so good you could hear a pin drop" with the company's current bragging rights, "fewest dropped calls."
"What kind of a message is that? Is that shooting for the top? What does that tell us about the telecom sector," Prentice said, drawing laughs.
But telecom is everybody's problem, the analysts said. Today's workers are faced with information overload -- and the proliferation of choices only makes things worse. Gartner estimates $100 billion will be wasted over the next three years by putting money into the wrong network technologies, such as color-display desktop IP phones and Gigabit Ethernet to the desktop.
"The CEOs who pay the bills are waiting for new ideas from their IT people, who are waiting for new ideas from their vendors, who are waiting for one of their competitors to show the way," Prentice said. "Everybody is waiting. Who will make the first move?"
IT organizations and vendors that succeed will be those that can "hide complexity," said Gartner analyst Daryl Plummer, introducing one of the major themes of the conference: virtualization.
Virtualization hides complexity, Plummer said.
The most successful companies will "embrace virtualization," he said, so they can stop focusing on systems and begin focusing on service.
Let us know what you think about the story; email: Linda Tucci, Senior News Writer
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