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Copyright 2007 IDC. Reproduction is forbidden unless authorized. All rights reserved.
Innovation through IT: Challenges and Opportunities
CIO 2007May 24, 2007Helsinki
John GantzChief Research Officer
©2007 IDC
AgendaAgenda
IT Innovation
Implications for CIOs
The Challenges of Transformation
©2007 IDC
$0
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2005 2006 2007 2008 2009 2010
Billions
Finland IT BudgetsFinland IT Budgets
©2007 IDC
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2005 2006 2007 2008 2009 2010
Billions
The Innovation ShockwaveThe Innovation Shockwave
©2007 IDC
©2007 IDC
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1,000
2006 2007 2008 2009 2010
The Information ExplosionThe Information ExplosionExabytes Created, Captured, or Copied in a Year
Source: “The Expanding Digital Universe,” IDC, March 2007; sponsored by EMC
©2007 IDC
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200
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500
600
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800
900
1,000
2006 2007 2008 2009 2010
Exabytes Created, Captured, or Copied in a Year
Source: “The Expanding Digital Universe,” IDC, March 2007; sponsored by EMC
~70% consumer generated
~85% incurring enterprise responsibility
~90% unstructured dataIT: integrated enterprise approach to information discovery, classification, and management
The Information ExplosionThe Information Explosion
©2007 IDC
The Device ExplosionThe Device Explosion
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1,000
2,000
3,000
2006 2007 2008 2009 2010
Camera phones
Cameras
PCs
WW Installed Base (Millions)
©2007 IDC
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1,000
2,000
3,000
2006 2007 2008 2009 2010
Camera phones
Cameras
PCs
WW Installed Base (Millions)
New devices: RFID, sensors, machinery, surveillance
New services: location, presence
Expanded IP networks: voice, video, building automation
IT: infrastructure and architecture become business decisions
The Device ExplosionThe Device Explosion
©2007 IDC
The Transaction ExplosionThe Transaction Explosion
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2006 2007 2008 2009 2010
Internet Commerce-Related Transactions
Source: IDC Internet Commerce Market Model, V11, March 2007
Billions WW
©2007 IDC
The Transaction ExplosionThe Transaction Explosion
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2006 2007 2008 2009 2010
Internet Commerce-Related Transactions
Source: IDC Internet Commerce Market Model, V11, March 2007
Billions WWMultiple transaction streams: B2B to B2C micro payments
Mobility, broadband, customer self service
Reliability, reliability, reliability
IT: now in the direct line of company revenue, service, and customer experience
©2007 IDC
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2000 2001 2002 2003 2004 2005
IT Security Vulnerabilities Reported (CERT)
The Mayhem ExplosionThe Mayhem Explosion
Source: Carnegie Mellon, Center for Emergency Response Team
©2007 IDC
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1,000
2,000
3,000
4,000
5,000
6,000
2000 2001 2002 2003 2004 2005
IT Security Vulnerabilities Reported (CERT)
The Mayhem ExplosionThe Mayhem Explosion
Source: Carnegie Mellon, Center for Emergency Response Team
Attacks more frequent and sophisticated
Hacker motivations have changed
Mandatory reporting coming
IT: prepare to spend more time in the boardroom
©2007 IDC
©2007 IDC
IT Domain GrowthIT Domain Growth
Everything on the IP network will be in the IT domain
IT responsibility will migrate outward and deeper into the organization
IT organizations will need new ways to work with the business on new apps, integration, budgeting
©2007 IDC
Source: McKinsey; increase in total factor productivity
8%
Project Returns*
IT Deployment
Mgt
Pra
ctic
es
<25%-tile
<25% -tile
>75% -tile
>75%-tile
0%
20%
2%
The SLA ChallengeThe SLA Challenge
LOBs determine the fate of IT!
©2007 IDC
The New IT OrganizationThe New IT Organization
Embedded IT
IT Marketing
Usage-Based Charges
Business Objectives
New Staff/ Organization
Job Rotation
New Reporting Structure
Capital Spending Visibility
Business Process Responsibility
Six Sigma Process Management
Mixed Outsourcing
Virtual Teams
Client Contact
©2007 IDC
Essential GuidanceEssential Guidance
Advanced IT organizations will need a service – not technical – mentality
IT portfolio management will require CEO involvement
Speed of IT system change will be a competitive weapon