E-business has entered a phase of consolidation and rationalisation that is likely to continue well into next year.
[VIDEO]This was the message presented at the opening of Meta Group`s METAmorphosis Forum For Meeting IT and Business Change in Pretoria this week.
In his keynote address, "Transforming while performing: The e-business odyssey", Meta Group president and CEO Dale Kutnick said the new economic model was forcing a need for cultural changes within businesses.
Kutnick said the world in general, and western nations in particular, are experiencing a new economic model that is manifesting itself in low employment, low inflation and a low but growing GDP, creating a combination that has not been seen before.
As businesses consolidate and rationalise, he said, the progressive merging of business operations and IT operations becomes fundamental. But one of the major stumbling blocks in the way of this merging is a lack of trust between top management and IT departments. He feels this is based on a history of late or non-delivery by IT departments, and a hoarding of information by both sides.
[VIDEO]According to Kutnick, those companies that can understand, embrace and exploit these changes will undoubtedly gain some early competitive advantage.
However, he noted that business/IT transformation and performance are co-dependant and that business priorities must dominate, although IT must not become just an afterthought.
Kutnick also highlighted the importance of high speed, high bandwidth information dissemination as a catalyst for the transformation of e-business. However, he expressed doubts about whether telecommunications companies would be able to come up with the money required to roll-out the necessary infrastructure within the next two years.
"I think that in the next two years, the reason there will be a delay in wireless deployment is that the telcos won`t have the money to invest in the infrastructure necessary to deploy high bandwidth wireless.
[VIDEO] "It is going to require a complete rework of the infrastructure to be able to support Generation 3 (3G) and to some extent even Generation 2.5 (G2.5). Investors are very nervous about over-investment and lack of tangible return in a short period of time, so I expect there will be a cutback, rather than immediate growth."
Kutnick also warned that from a performance delivery viewpoint, companies have to make a commitment to human capital management. He said that despite the "bloodletting" in companies worldwide, certain skills are still in very short supply.
"Despite the retrenchments, I think there will continue to be a shortage in the IT skills that are necessary to move ahead."
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