2007 Australian ICT Trends

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The following presentation outlines the ICT trends identified by Longhaus as being key to the Australian and near-shore market in 2007. The full report of this synopsis is available in the December edition of longview from 15th December 2006.

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2007 Australian ICT Trends

  1. 1. 2007 Australian ICT Trends Longhaus Research Team December 2006
  2. 2. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>The following presentation outlines the ICT trends identified by Longhaus as being key to the Australian and near-shore market in 2007. </li></ul><ul><li>The full report of this synopsis is available in the December edition of longview from December 15 th 2006 . </li></ul><ul><li>You may opt-in to receive your complimentary copy of the full report, and our monthly newsletter, at www.longhaus.com . </li></ul>
  3. 3. Longhaus’ Australian ICT Market Segmentation and Research Model <ul><li>Our research reports are based on the following segmentation model </li></ul><ul><li>Services </li></ul><ul><ul><li>Right across and down the stack, but lower down is less valued </li></ul></ul><ul><ul><li>Value is in “process and information” </li></ul></ul><ul><li>Business Applications </li></ul><ul><li>Software Infrastructure </li></ul><ul><li>Hardware Infrastructure </li></ul><ul><li>Connectivity </li></ul><ul><ul><li>Right up the stack, but higher up is less valued </li></ul></ul><ul><ul><li>Value is in connecting the “technology” </li></ul></ul>
  4. 4. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Vertical application solutions will outperform ERP and CRM </li></ul><ul><li>During the last decades of the 20th century ERP and CRM implementation represented a major industry focus for organisations seeking competitive advantage through best practice process implementation. In 2006, ERP and CRM are now “tickets to play” in modern business. Concepts need to be defined about both participants and targets… </li></ul><ul><li>Trend: Managing, not implementing, SOA becomes the real problem </li></ul><ul><li>The benefits of SOA have in the short term been reaped more by ISV’s rather than end user organisations. ISV’s have benefited from SOA by creating more agile, integrated applications that are easily extendable and interoperable. The presence of SOA within organisations is now inevitable as the latest round of upgrades of everything from ERP systems to operating systems brings SOA capabilities firmly into the hand of end users... </li></ul>
  5. 5. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Semantic web drives information management renaissance </li></ul><ul><li>The W3C is pushing hard on adoption of semantic web technologies promising access to internet-accessible content intelligently labelled, interpreted and linked through applications that can understand document relationships and discover hidden information. Enterprise interest in semantic web is now also rising. Firms are seeking a more effective method of identification of information with regulatory significance, such as corporate e-mails, spreadsheets… </li></ul><ul><li>Trend: Service and contract management the next commodity solution </li></ul><ul><li>Having commoditised the processes of human resources, financial control, customer relationship and supply chain the next commodity business application is service and contract management. While many ERP and CRM solutions address the transactions associated with these arrangements few have risen to the challenge of truly managing the contracts themselves and associated service levels. The real need is not the pipedream of business to business XML-based bidding for contracts, but the day to day management of the contract cycle underpinned by document control, workflow, trigger point notifications for approvals, reviews and exchange in a collaboration style implementation… </li></ul>
  6. 6. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Post Y2K bubble looms as an asset replacement train wreck </li></ul><ul><li>When projects all arrive at the same point at the same time project managers will often describe the situation as a “train wreck”. When the point is reached everything stops. This is an apt description for what is set to occur within the Australian ICT sector over the next 24 months as the majority of companies in the region attempt to renew critical infrastructure simultaneously. Pre-Y2K a firm’s technology renewal cycle was determined by its own business needs. Y2K projects changed the status quo as companies were forced into an artificial round of major repairs and upgrades – essentially a “big reset” for Australian ICT asset cycles... </li></ul><ul><li>Trend: Profiteering enters offshoring market, economic cracks appear </li></ul><ul><li>Organisations have explored the cost and price parameters of skilled labour activities in the original offshore market for the last three years. The initial rise of the offshoring industry was founded on the back of indigenous Indian firms with their associated low input costs. With the entry of everyone from multi-national outsourcers and system integrators, to independent software vendors and call centre specialists to the region all trying to maintain the perception of large price reductions to clients, it is becoming difficult... </li></ul>
  7. 7. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Virtualisation becomes mainstream for service providers </li></ul><ul><li>The traditional deployment model for service providers of dedicated server infrastructure per customer is being cast aside as shared infrastructure beyond storage and networks is being extended across the stack. The win-win flexibility of end to end virtualisation and the “right sizing” of infrastructure to applications is a technology reality today… </li></ul><ul><li>Trend: Open Source commoditisation continues to move up the stack </li></ul><ul><li>Open Source vendor RedHat’s recent acquisition of JBoss, the developer of the now ubiquitous J2EE application server, underscores the continuing trend of commercial Open Source vendors moving up the architecture stack. Both RedHat and competitor Novell (with the SuSE linux distribution) have continued to move into application development toolsets, application servers and even Business Process Orchestration and Enterprise Systems Management solutions… </li></ul>
  8. 8. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Vendors search for revenue in the SMB market </li></ul><ul><li>H aving squeezed the top end of the market large vendors are now looking further. SAP have estimated 65% of their revenue is SME. IBM say that 60% of their local revenue is via partners, who in the main serve either SMB or Government. IBM’s long range strategy to improve the penetration into the SME market, particularly with their software business, has been a focus for at least the last two years. Locally, the traditionally high end storage vendors such as EMC and Hitachi Data Systems have placed significant effort into the SMB segment and channel programmes, and are already yielding results above expectations… </li></ul><ul><li>Trend: Software-as-a-Service (SaaS) finally shrugs off the spectre of ASP </li></ul><ul><li>Application Service Provision (ASP) was one of the unlucky victims of the Dot Com bubble burst in 2001. While the model itself was never flawed, challenges such as low bandwidth and high cost of initial software development meant the early adopters struggled as the market withdrew capital. In 2006, increased bandwidth, particularly broadband adoption by SMBs, coupled with the reducing cost of software development through open source and offshoring, has seen the phoenix-like rise of Software-as-a-service (SaaS) from the ASP ashes… </li></ul>
  9. 9. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Staking a claim on Vitruvian marketing practices in Australia </li></ul><ul><li>At the highest levels of global organisations there is a drive to define the corporate customer experience through more sophisticated segmentation models, customer database management, persona development, and other &quot;first-line&quot; services that support and drive the marriage of marketing strategy, technology and analytics (termed Vitruvian marketing by longhaus). However, due to an under-penetration in Australia of the major international vendors (such as Harte Hanks, Acxiom, and Experian etc), the discipline of marketing and its technology highway in Australia are at a crucial crossroads… </li></ul><ul><li>Trend: The CIO and CMO roles will define the customer experience </li></ul><ul><li>For years the dual roles of CEO and CFO have walked lock-step at the head of major organisations. As institutional power (top-down) is replaced by consumer power (bottom-up) in all markets, the new lock-step duo of Chief Information Officer (CIO) and Chief Marketing Officer (CMO) will own the customer and drive the strategy for progressive organisations... </li></ul>
  10. 10. For full reports visit www.longhaus.com from December 15 th, 2006 <ul><li>Trend: Competition heats-up between demand-management vendors </li></ul><ul><li>Overloaded ICT project portfolios, and skill-set shortages across the fields of application development, project management, implementation and technology financial management in Australia will accelerate the adoption of Program and Portfolio management solutions. To maintain a position of business enabler, and provide real-time dashboards of demand and risk management, portfolio process automation is required to provide CIOs with the ability to run strategic businesses based on operationally tight project information… </li></ul><ul><li>Trend: Increased authority for CIOs will test ICT operational leadership </li></ul><ul><li>Organisations should check-point the balance of focus between business activities and operational activities being conducted by their ITOs. As CIOs are given greater authority to pursue a focused organisational push for increased ICT and business alignment, major organisations will be challenged to maintain a lights-on concentration in the areas of operational (ITIL-based) ICT management... </li></ul>
  11. 11. Thank you <ul><li>Longhaus </li></ul><ul><li>Level 30, AMP Place </li></ul><ul><li>10 Eagle Street </li></ul><ul><li>Brisbane QLD 4000 </li></ul><ul><li>p: +617 3868 4796 </li></ul><ul><li>f: +617 3303 8445 </li></ul><ul><li>[email_address] </li></ul><ul><li>Peter Carr </li></ul><ul><li>Managing Director </li></ul><ul><li>[email_address] </li></ul><ul><li>+61 408 344 405 </li></ul><ul><li>Kristine Carr </li></ul><ul><li>Communications Director </li></ul><ul><li>[email_address] </li></ul><ul><li>+61 405 515 469 </li></ul><ul><li>Sam Higgins </li></ul><ul><li>Research Director </li></ul><ul><li>[email_address] </li></ul><ul><li>+61 412 621 014 </li></ul>

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