Reinventing for change: The challenges of predictable ICT in Australia and New Zealand
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The document discusses challenges facing Australian and New Zealand CIOs and ICT organizations in managing predictable change. It finds that while business and ICT cycles provide some predictability, the perceived value of ICT shifts over time. CIOs must balance planning, provision, and operation of ICT services to successfully meet changing needs. Emerging strategies like open source, virtualization, and SaaS present opportunities but also risks if not properly implemented and managed.
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Reinventing for change: The challenges of predictable ICT in Australia and New Zealand
- 1. Reinventing for change The challenges of predictable ICT in Australia and New Zealand Sam Higgins Research Director August 2008
- 5. Predictability in business is hard, but patterns help CEOs plan ahead 36 qtrs. 34 qtrs. 33 qtrs. 38 qtrs. 34 qtrs. Source: Paul Ruthven of IBIS World 07/12/07 33 qtrs. Average long business cycle is 34 quarters (8 1 / 2 years) Forecast Annual real GDP growth (%) progressed in quarters to September 2007 (and forecast to June 2011)
- 6. And savvy CIOs recognise that patterns also exist for the “ business of ICT” Source: Longhaus Post Y2K Synchronised ICT Asset Renewal Cycle Commercial-in-confidence 2001 2002 2003 2004 2005 2006 2007 2008 2009 Business As Usual Asset Replacement Renewal Planning
- 10. The result is that CIOs face a raft of challenges both business and technical Commercial-in-confidence
- 11. Addressing these challenges requires a balanced approach to planning and provision of ICT services Commercial-in-confidence Use of ICT in the Business Provision of ICT for the Business The Business operation of ICT
- 12. Service management remains a key strategy locally for improving the business of ICT Commercial-in-confidence
- 13. But many organisations focus on project management ahead of service management Commercial-in-confidence
- 14. Provisioning of ICT for the business remains hardware focused, but this is changing Commercial-in-confidence
- 15. Open source, SaaS and Virtualisation are emerging as mainstream ICT strategies Commercial-in-confidence
Editor's Notes
- 22/05/09Copyright 2006 Longhaus Pty Ltd - All Rights Reserved<number>22/05/09Copyright 2006 Longhaus Pty Ltd - All Rights Reserved<number>
- 22/05/09Copyright 2008 Longhaus Pty Ltd - All Rights Reserved<number>
- When we think about change we often think of sudden and unpredictable events. Something we are subject to, something out of our control. The reality is that while making exact predictions can be difficult with enough information we can glean some sense of order from the chaos around us.For example, if we consider the quarterly GDP rates for Australia over the last 40 years a pattern emerges. A business cycle that when recognized can be used by business leaders to plan ahead to be prepared. As my wife is fond of saying – luck is just good preparation that allows us to capitalise on an opportunities.
- Just like the business cycles of the macro-economic environment, there are also patterns and cycles that exist within the ICT industry.For example, there is the ICT Asset Renewal Cycle driven by what Longhaus calls the “Big Reset” that occurred around 2000. The Big Reset actually made ICT spending more predictable. Unlike the preceding 30 years where ICT asset cycles were characterized by timing of technology adoption by industry verticals, Y2K artificially brought almost all organizations onto a single asset renewal cycle.As you can see once we take account the typical useful life of ICT assets (typically 3-5 years), plus the renewal planning that occurs to address this you can see we’ve already experienced much of the asset replacement activity already. What is next is the bedding down of these assets into an effective and stable environment of keeping the lights on as many organisations begin the process of looking forward into the renewal of their core business applications that in Y2K were often not replaced, but merely patched.
- 22/05/09Copyright 2008 Longhaus Pty Ltd - All Rights Reserved<number>
- Self ActualisationCreativitySpontaneityEsteem NeedsConfidenceAchievementSocial NeedsFriendship and familySafety NeedsPersonal securityPhysiological NeedsFood and waterAs the harder times set in, Maslow’s theory says we focus on the more basic needs. Only when those are not threatened or in abundance are we able to focus on higher order needs and pursuits. 22/05/09Copyright 2008 Longhaus Pty Ltd - All Rights Reserved<number>
- Recent research by Robert Urwiler and Mark Frolick has shown that organisations exhibit similar “needs” concepts that translate to perceived value and behaviour. Niether Urwiler or Frolick link these needs to economic cycles, but it is Longhaus’ experience that the focus of organisation on ICT changes with the times.A classic example if the shift of CIOs within the organisation structure. At the start of the economic cycle when times are booming and capital investment by the board is high they report to the CEO. By the of the cycle when ICT is treated as a pure commodity and business as usual the CIO may find themselves as simply the 2IC to the CFO.What is interesting is that given the current stage of the cycle Longhaus is seeing a return to the Stability & Security level.22/05/09Copyright 2008 Longhaus Pty Ltd - All Rights Reserved<number>
- COBIT includes the Val IT Framework.22/05/09Copyright 2008 Longhaus Pty Ltd - All Rights Reserved<number>
- 22/05/09Copyright 2008 Longhaus Pty Ltd - All Rights Reserved<number>22/05/09Copyright 2006 Longhaus Pty Ltd - All Rights Reserved<number>