SharePoint-based solutions to exceed all expectations
While Microsoft will be disappointed with the number of enterprise deployments of Windows Vista and Microsoft Office 2007 during the coming year, deployments of SharePoint-based solutions will exceed all expectations. Microsoft’s apparent commoditization of the enterprise content management (ECM) market could well start a price war among established vendors as they try to up-sell and compete with Microsoft.
Those vendors with large ECM product portfolios will consider discounting their document and records management modules in the hope of securing more business down-the-line. Consumer-oriented internet- and web-based technologies will continue to infiltrate the workplace, and these will cause many CIOs to re-think their information worker strategies.
Green IT – power efficiency issue firmly under the spotlight
Improvements in many areas of the IT infrastructure – better processor performance, higher levels of throughput and greater disk densities, to name but three – have led to a general acceptance that everything is getting better, faster and more efficient. There is, however, one area where efficiency is lagging – and that is in the area of power performance.
This leads to concern about the cost of maintaining the IT infrastructure, especially in data centers, which can have a power efficiency level as low as 70%. When one considers that a domestic gas or oil central heating boiler runs at around 80% efficiency, and these are coming under close scrutiny to make them more efficient, it is clear that the whole power efficiency issue within IT is now firmly under the spotlight.
Legacy ERP and methodology confusion to hold SOA back
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In spite of the biggest vendors’ best efforts, enterprise resource planning (ERP) customers will not be persuaded to upgrade during 2007, merely to gain flexibility. Genuine business needs will drive the upgrade cycle – and this must be met by delivering new functionality not dressing old applications in new clothes.
Although service-oriented architecture (SOA) is seen as an essential construct for enterprise applications by the majority of vendors, it will take a number of years for the market to catch up.
For those that do embark on more ambitious SOA projects, the use of a methodology built around the requirements of SOA will become mandatory. To date, most of the initiative towards creating SOA methodologies has been taken by the system integrator community, but software vendors will start to view the delivery of a methodology to be a competitive differentiator. Consequently, we could face methodology proliferation, which could actually add to the confusion around SOA implementations.
Virtualization to dominate the data center
The virtualization of the IT infrastructure, including servers, storage, networks, and clients, is a key technology to improve the flexibility and utilization of the data center. In a competitive market, EMC is the dominant technology provider, but will be chased by other solution and service providers including HP, Cisco, and IBM.
Microsoft will continue to build a diverse capability in this market, and, following on from the acquisition of Softricity and the recent agreement with Novell, the company is expected to extend its reach through further partnerships in order to strengthen its offering. Ardence and SWSoft are potential targets for acquiring vendors.
Measuring IT’s business value a key challenge for the CIO and CEO
Although IT is maturing as a business function, it still lacks some of the accepted methods, comparable to those found in other areas of the business, for measuring the value that it delivers. The outcome that is sought is business value, enabled by IT, rather than IT value per se. This makes it essential to establish a formal framework that can be used by both business and IT leaders to support value measurement.
Initiatives such as ValIT and the IT Capability Maturity Framework (IT-CMF), and the broader use of project and portfolio management (PPM) tools, are supporting this move, but, above all, it requires the development of a common language and frame of reference for describing business value, and for agreeing the appropriate metrics by which individual projects should be measured. This will be a key challenge for both the CIO and the CEO during 2007.
The ‘Microsoft effect’ on the security market will be significant
During 2007, expect the ‘Microsoft effect’ on the security marketplace to be significant. At the moment, there is something of a phony war going on between Microsoft and leading security vendors such as McAfee and Symantec over Microsoft’s kernel management approach to the 64-bit version of Vista. Other security organizations such as Aladdin and Sophos believe that Microsoft is right to take this one-time opportunity to adequately protect its core. This and other incursions into the security arena will keep Microsoft in the security limelight.
Expect the ESB to commoditize
The factors are all in place for the enterprise service bus (ESB) market to start to become commoditized. There are more vendors than the market will be able to support in the long term, and this will result in price pressure. At the same time, open source products offering ESB functionality will start to have an impact upon the market, moving revenue away from upfront license revenue towards periodic maintenance fees.
Finally, SOA will become more approachable by mid-sized organizations, increasing the demand for entry-level products at cost-effective price-points.
BPM will reinforce its position as a mainstream technology
Business process management (BPM) will reinforce its position as a mainstream technology, with a great deal of emphasis on the decomposing of processes into finer levels of granularity. The coming year will also see more importance attached to the issue of process discovery from existing assets rather than modeling process from a green-field site.
There will be a greater degree of understanding of the benefits of business rules, and how these need to be implemented as a service. This requires a separate management solution and the business rules management system (BRMS) space will grow in respect of both understanding and adoption.
Performance management will drive BI deployments
The trend for vertical and ready-made solutions will continue as pure-play vendors continue with their efforts to put more distance between themselves and Microsoft. In particular, there will be a number of new pre-packaged applications for corporate performance management for MiFID, marketing management, and retail.
Consolidation will continue in the supplier market with the acquisition of disruptive vendors such as SeeWhy by pure-play business intelligence (BI) vendors. Platform vendors IBM, Oracle and SAP are likely to make acquisitions too.
Outsourcing will require increased flexibility
It will finally be clear in 2007 that few organizations will consider going back to lengthy, single-supplier outsourcing deals. The large number of existing deals reaching renewal stage will reinforce the trends towards deals of shorter duration, regular reviews of objectives, and the involvement of multiple vendors, which are making successful outcomes in outsourcing engagements into moving targets that can only be achieved by ever closer partnerships.
Organizations looking for ways to cut spiraling data center costs will see remote infrastructure management delivered from offshore locations as a realistic option. Costs of maintaining up-to-date skills in data centers, and of investment in technology transformation such as consolidation, and advanced management capabilities, are strong drivers towards this type of service, which has undeniable financial benefits that we believe should be considered carefully.
Fixed mobile convergence set to gain significant traction
Fixed mobile convergence (FMC) is set to gain significant traction throughout 2007. Either through the use of private GSM networks, or WiFi, mobile phone usage is about to undergo a radical change, which will at last hand control back to the organization and bring a new degree of flexibility and innovation, by providing the ability to integrate mobile phones into the enterprise network.
More emphasis will be placed on unified security
As a direct result of the consolidation that has taken place in the security market over the past 12 months, during 2007, expect to see more emphasis being placed on the requirement for unified protection and network infrastructure security systems. One example is unified access control – products that enable organizations to understand all devices that operate across their networks, and then extend their reach to controlling how such devices should be evaluated and managed as they attempt logon, including the evaluation of device acceptability and end-user authentication.
Agile methods aid development maturity
In the past, application development in IT departments was typically an ad hoc process driven by a ‘hero’ (or inspired individual) – what the capability maturity model integration (CMMI) would describe as level 1 (of 5). Today, we find agile approaches taking the developer community by storm and we expect 2007 to see continued growth in adoption of what are highly disciplined methodologies that developers also enjoy using, from extreme programming and SCRUM to DSDM and other variants.
RFID tags will start to be used at the product/item level
The supply chain is an area where technology can deliver real benefits – radio frequency identification (RFID) is revolutionizing the way that products are manufactured, tracked, bought, and sold. During 2007, RFID tags will start to be used at the product or item level rather than on pallets and containers. Packaging this technology into applications will enable faster deployment, and will be a significant area of investment for applications vendors during 2007. This may be achieved by further acquisitions or by increased partnering in the market.
