Small and medium-sized businesses (SMBs) are spending more on software and IT services, and these investments will continue to rise through 2019, according to IDC’s Worldwide Small and Medium-Sized Business Forecast. One main reason for this projected increase, wrote report author Raymond Boggs, is that SMBs are looking to new business resources such as alternative technology to help gain competitive advantage.
“Increasing investment in technology is an appealing way for firms to expand their capabilities without necessarily increasing their head count,” Boggs wrote.
IDC forecasted that total SMB IT spending will increase 4.4% year over year, from $560.3 billion last year to $694.5 billion in 2019. Drilling down, software spending will see the greatest increase, growing 6.8% annually through 2019; IT services will grow 4.7% annually, and telecom equipment takes third place at 4.4%.
This increased spending on software and services is in keeping with SMBs placing greater emphasis on solutions, particularly related to cloud and mobility, according to Boggs.
Meanwhile, spending on PCs and peripherals, systems, and storage, will grow at a slower rate, less than 3.5% annually. However, Boggs noted that in both categories, “the transitions to mobility and new technology approaches will still provide attractive growth opportunities.”
Compass Intelligence analyst Stephanie Atkinson agreed that SMBs are looking to more sophisticated solutions, particularly in the cloud, as they struggle to maintain expertise in-house in the midst of rapid technology change.
“The SMB sector continues to look for simplification opportunities when buying technology and telecom services, and cloud-based services provide just that,” she wrote in a blog post. One driver is that many cloud-based services, such as backup, collaboration and storage solutions, offer flat-rate billing or a recurring monthly fee.
“SMBs are often faced with managing cash flow on a week-to-week basis, and having a planned and fixed budget for IT/telecom services is highly preferred,” Atkinson wrote.
According to Compass Intelligence research, the cloud computing and services market is currently experiencing a 40% compound annual growth rate, and will continue to do so through 2016, at which point the market will hit $50 billion (see chart).
Hybrid cloud, which blends public and private cloud platforms, involves lots of arduous integration work — so preparation and governance work need to be carefully and deliberately executed. That’s a tall order when you have vendors beating down your door.
So how do you control the vendor hype?
That was the question directed at a panel of experts at the recent Hybrid Cloud Summit in Cambridge, Mass.
“Unfortunately it’s very hard to control the hype,” said panelist Judith Hurwitz. “Because part of the hype is that the technology industry is very ADD. You’ve got to go on to the next exciting thing.”
Hurwitz isn’t a medical doctor, so her diagnosis of attention deficit hyperactivity disorder shouldn’t be taken literally. But the president of consulting company Hurwitz & Associates and author of many books on IT was making an important point: Vendors know IT people covet the latest gadget, and they exploit that. They’ve got products to sell, after all.
But therein lies the problem. Buying into that hype can cause organizations looking for a competitive edge to flub an installation — possibly go over budget or even scrap it.
Get rid of the vendors, then. The age-old, tongue-in-cheek suggestion was made by attendee David von Vistauxx, senior security analyst at cloud software company Virtustream. It was met with spirited laughter from the audience, which had taken in five hours of PowerPoint presentations and discussions on the finer points of hybrid cloud computing.
Alas, it’s no joke — you can’t remove vendors from the picture, said David Linthicum, a consultant at Cloud Technology Partners and another prominent IT author. For one thing, they have all the money, which helps drive innovation in the industry.
“You’ve just got to learn how to listen to vendors, how they spin things and what they say,” said Linthicum, who sat next to Hurwitz on the panel. “Judith and I have been in the business a long time, so we can get beyond the BS that they spin to us and get right down to the essence of what it is.”
Hurwitz’s advice for CIOs and IT is to educate people about the new technologies grabbing headlines and let them know what the limitations are today.
“You can look at almost anything that has emerged as hype over the last 10 years and see where its roots are,” she said. Help them tell the difference: “‘This is the piece that’s solid and old; this is the piece that is emerging. It would be good to experiment with this, get some experience, but we’re going to have to wait until it matures.'”
Pamela Wise-Martinez, chief cloud and enterprise data architect at Pension Benefit Guaranty Corp., the U.S. government agency that protects pensions, described the customer-vendor dynamic this way: a partnership. The question is, how well can it work? Sometimes, she said, it all depends on the contract and service-level agreements.
“You have to find ways to build a more collaborative approach and be partners, because we all have a stake,” she said. “I’m trying to win the people I’m servicing, and the vendors trying to win with more business — so if you partner you can all win.”
Are you practicing DataOps at your company? In this week’s Data Mill column, senior news writer Nicole Laskowski explores the emergence of DataOps and outlines three steps to building an Agile analytics program.
The Internet of Things (IoT) is changing the way companies do business, but it’s also sounding both new and familiar alarms over data privacy and security. In this new photo story, SearchCIO followers detail their top IoT privacy and security concerns and how to deal with them.
In this week’s Searchlight, features writer Jason Sparapani reports from the Hybrid Cloud Summit on the significance of hybrid cloud environments to IT and business.
Speaking of data security, our most recent handbook attempts to answer the following question: In a breach-a-minute era, how can we achieve data security? SearchCIO expert Harvey Koeppel chimes in by outlining a cybersecurity checklist for IT leaders to follow, and CTO Niel Nickolaisen offers three security processes that can help mitigate human error.
Over on the Total CIO blog, Laskowski discusses startups that are building products and services for aging adults, and site editor Fran Sales explores what HP must do to stay relevant post-layoffs. On the CIO Symmetry blog, Sparapani discusses modern practices for measuring ROI for cloud investments.
Cloud services are growing in popularity, but businesses must be careful to protect against constantly evolving data risk. In this tip, SearchCompliance expert David Loshin gives advice on mitigating cloud computing risk.
Finally, what are your 2016 IT budget expectations? Join SearchCIO’s #CIOChat Wednesday, Sept. 30, at 3 p.m. EST, to discuss 2016 IT budgeting and the rise of business technology spending. See you there!
Measuring ROI for cloud investments isn’t what it used to be.
As more companies consider moving their IT operations to the cloud, they’ve stopped thinking solely about saving on capital expenses and more about making the business more nimble, and ultimately, competitive, said Brett Gillett of Softchoice, a software reseller based in Toronto.
“Customers even over the last couple of years have become more cloud savvy and realized that there are opportunities for cost savings,” said Gillett, who consults with companies that want to move to the cloud and builds and manages deployments. “But it really comes down to really speeding up your business, your time to market and your being able to deploy infrastructure for your clients.”
In the past, businesses were more interested in one-to-one price comparisons: examining what it costs to run an application on premises versus running it in the cloud. If the analysis showed the cloud would return cost savings, that’s where they’d head.
“That’s the way the conversations used to be,” he said. “What the conversations are like now is, ‘Well, here’s our budget, this is what we’re spending and we think we can do it for that or less, but if it’s a little more than what we’re currently spending and it allows us to get to market a lot faster, we’re still OK with that.’ ”
Human costs hard to quantify
Businesses still want to know what storage and compute hours will cost in the cloud, of course. But pricing models today make that relatively easy to do, Gillett said. What isn’t easy is comparing those costs to what they’re spending on premises. For example, it’s hard to estimate what Gillett calls the human costs — the people businesses rely on to manage and maintain their physical infrastructure.
“Do they really, really know how much time their technical folks are spending managing that database environment?” he asked. “Do they know how much time in their on-premises database their administrators are spending to maintain that? In most cases they probably don’t, so it’s very hard for them to understand what it’s actually costing them to maintain that.”
Another question: What happens to those employees once the move to the cloud is made?
“Those bodies may not need to exist in a public cloud environment because you’re offloading that to the provider; they’re going to manage the facility, they’re going to manage the physical network,” Gillett said.
Giving those admins higher-value tasks like data analysis is a classic benefit of cloud computing — making better use of expensive resources. But it’s harder for businesses to articulate what the savings would be.
See into internal services, see ROI
Businesses today are also interested in moving up the “value chain of cloud,” Gillett said. He meant going from straight infrastructure in the cloud to platform services like managed databases. They cost more, but the advantage is businesses can offload tasks that don’t differentiate them from their competitors.
“Everybody patches software,” he said, to cite an example. “Everybody installs software, so why not offload that to a cloud provider so you focus on the data that’s in that database, managing that data rather than managing the infrastructure that it sits on.”
But factoring in such moves muddies the cloud calculations even more.
“As soon as you try to calculate the value or how much you’re spending to patch or update your databases, that’s a much harder thing,” he said.
Businesses that are solidly grounded in ITIL, the protocol for delivering and supporting IT services, will have an easier time proving ROI for cloud investments, Gillett said. If businesses have visibility into say, how many help desk incidents they’re managing and how much that’s costing them, they can more easily make on-premises-to-cloud cost analyses.
“They really need to have a very structured system where they’re recording all of the work they’re actually doing, whether it’s change records, incidents or problems,” he said. “Without that it would be very hard to know how much time you’re actually spending maintaining those environments.”
Thinking about starting an IoT initiative at your organization? Before you do, there are some things you should know. In this feature by senior news writer Nicole Laskowski, read up on IoT basics and get expert advice from CIOs on how to proceed with your IoT strategy.
HP just cut 30,000 jobs in preparation for the upcoming launch of its newly separate enterprise services business. What do the cuts mean for the tech giant and can HP Enterprise meet the needs of CIOs? In this week’s Searchlight, site editor Fran Sales explores these questions and talks to expert CIOs to get their take. Also in Searchlight: Salesforce’s “Internet of Things Cloud” service and GE’s plan to aggregate its software, IT and industrial security capabilities into one digital unit.
Don’t fear cloud services management. In this two-part story, Gartner analyst Mindy Cancila breaks down do’s and don’ts when managing the cloud. In part one, she details the importance of monitoring the cost of cloud-based services in avoiding unnecessary surprises. In part two, she explores ways CIOs can evolve traditional management procedures to fit their cloud needs.
Business differentiation is more important to big data frameworks than you think. Laskowski explains why you should be focusing departmental efforts on what differentiates the business and rely on vendor partners to do the rest.
The age of traditional, all-knowing management approaches is coming to an end, according to SearchCIO expert Joseph Flahiff. Instead, managers’ new role involves “supportive leadership” to allow the whole team to flourish in today’s work environment.
Computers and devices are increasingly becoming key witnesses in court cases, which means information governance processes need to be kept in check to produce reliable digital evidence. SearchCompliance expert Jeffrey Ritter shares advice on how to ensure the computer is a dependable witness by developing a solid governance strategy.
On the TotalCIO blog, Laskowski runs through five steps to get your enterprise IoT initiative started. Plus, over on the IT Compliance Advisor blog, site editor Fran Sales runs down the latest GRC news, including the court ruling that Dodd-Frank protects internal whistleblowers and the Commodity Futures Trading Commission’s plan to control high-frequency trading risks.
As if you needed even more convincing that Apple was serious about breaking into the enterprise, here’s further proof: Its business-centric iPad Pro is bigger, lasts longer and performs faster than its predecessor (and comes with a stylus, to boot). Could this be the device that gives Apple the edge over its competitors in the enterprise? On Searchlight, assistant site editor Brian Holak turned to industry experts and CIOs to get their answer – which was both yes and no.
No matter how fortified you think your organization is to cyberthreats, it’s probably still extremely vulnerable. One reason for this, according to analyst Steve Wilson and IT security leaders, is that we’ve become reliant on process and audits instead of directly addressing the underlying problem: “brittle” IT systems. Writer Mary K. Pratt consulted cybersecurity experts to get their advice on how to re-engineer these inadequately protected IT systems and take advantage of next-generation security tools.
In the age of the customer, companies large and small are turning to business process management (BPM) principles, or value disciplines, to improve their customer-facing processes. In this video, BPM expert Ken Lewis lays out how a company’s choice of value discipline affects its IT systems and points toward a future that integrates systems of record with systems of engagement.
Speaking of today’s customer-centric business environment, many CIOs are stuck in the past, when internal operations reigned supreme. This attitude could be career-ending, as Forrester analyst Bobby Cameron put it. Now, the buyer holds the power, and CIOs must focus on technology that serves them. Cameron shared with features writer Jason Sparapani his list of five predicaments that CIOs should steer clear of – lest they put their careers at risk.
When Apple and Cisco announced last week that they were teaming up to “optimize” enterprise networks for iOS devices, industry experts were lukewarm on the deal, mainly because of the lack of details. However, CIOs on Twitter were more enthused about its possibilities for enterprise. On the Total CIO blog, see why some CIOs see the alliance as a big step forward.
“Geobytes” and “brontobytes” have now replaced terabytes as commonly used measurements for the amount of data produced each year, making big data governance an increasingly tall order for the modern companies that generate and store them. In this SearchCompliance tip, expert Jeffrey Ritter offers five strategies for how to make governance an easier process.
Apple and Cisco announced this week that they are partnering to make Apple devices work better on corporate networks that use Cisco technology. It sounds like a win-win, but details are sparse. In this week’s Searchlight, site editor Fran Sales parses through the Apple-Cisco deal and gets analysts’ reactions. Also in Searchlight: Samsung gives Apple Watch some competition and Google unveils a new logo.
Sometimes IT vices can be turned into virtues. In this tip, Gartner analyst Danny Brian explains how IT pros who are lazy, impatient and hubristic are just who CIOs need to build the perfect team.
Enterprise data architecture strategies aren’t what they used to be. According to David Loshin, president of Knowledge Integrity Inc., today’s data environments call for CIOs and their teams to align existing data systems with growing information needs, capabilities and data sources. Take a plunge into the big data lake and explore data virtualization tools in this SearchCIO tip.
With the increased use of devices in the workplace also comes increased governance hurdles. To keep pace with these challenges, IT and security executives are forced to develop more comprehensive mobile data security plans and implement stronger technology solutions. SearchCIO contributor Mary K. Pratt talks to the pros to find out best practices for mobile data security and governance.
Speaking of data governance, IT regulations continue to strain corporate resources, but incorporating data governance into policies can help your GRC initiatives flourish while remaining compliant. Loshin dishes out data governance advice that can help facilitate compliance initiatives.
Playing it safe won’t get you very far in today’s business environment, especially when so many other companies continue to redefine their industries in new ways. In this month’s CIO Decisions e-zine, we talk to five IT leaders-as-industry-disruptors and find out what they’re doing to transform their companies and their industries. Also in this issue: how the head of data science at The New York Times is predicting subscriber churn and how CIOs are being pressured to take advantage of data monetization.
On the IT Compliance Advisor blog, Sales runs down the latest GRC news, including how Apple CEO Tim Cook’s email may have defied SEC disclosure rules, Charles Schwab’s $2 million fine from FINRA and the U.S. appeals court assertion of the FTC’s corporate cybersecurity powers.
Cyberdefense has become major concern across the globe: Individuals, companies, governments and even national security are all being threatened by cybercrime. As the cyberthreat landscape grows more dangerous by the day, SearchCIO contributor Harvey Koeppel offers a 12-point cybersecurity checklist for CIOs. Step No. 1: Ensure everyone in your organization understands that cybersecurity is not just an IT concern; it is everyone’s problem.
Just because you say your IT organization functions as a full-fledged partner to the business doesn’t make it true. Gary Watkins, CIO of IT Shared Services at KAR Auction Services Inc., a Fortune 1000 global provider of used vehicle auction services in Carmel, Ind., has engineered a plan that aims to walk the talk. Watkins calls the plan the “big switch” and it has big goals: to turn the 130-person IT staff from a technology supply organization for KAR’s 12,000 employees into a business-savvy IT service provider.
Success in the CIO position has less to do with building technology prowess and more to do with the ability to master other areas of expertise important to running a business, according to research from Columbia University. This week’s Data Mill explores how CIOs can use these findings to succeed in their role.
This month marked the formal launch of “The Cookie Dining,” a platform that lets customers order food via restaurant-branded mobile apps or websites. Developers say The Cookie Dining’s platform business model distinguishes itself from established rivals by offering real-time payment, lower commissions and analytics. The platform’s biggest challenge thus far, however, isn’t on the technology side.
Stock market volatility was big news this week after China’s Shanghai Composite index saw an 8.5% drop on Monday. The drop caused global markets to plunge and hinted at cracks in an otherwise sturdy U.S. economy. Stock markets rebounded as the week went on, but should CIOs be worried the instability will put pressure on IT budgets? Also in Searchlight: Google fights claims of market abuse; Windows 10 hits 75 million devices in one month.
As data volumes continue to grow, information governance has become central to an organization’s ability to demonstrate regulatory compliance. In a guest blog post for the IT Compliance Advisor, ARMA International’s Diane K. Carlisle discussed the characteristics of a strong information governance program and how organizations can use recordkeeping tools to benefit compliance operations.
Data virtualization technology is shifting from a tactical concern to strategic one as businesses look to integrate and access data from across Web sources, social media and the Internet of Things. In this Q&A, data management expert Rick Sherman explains why data virtualization should be on the CIO radar, the benefits it brings over traditional data integration tools and how it can be used for competitive advantage.
CIOs diving in to new technologies or strategies are often told to “start small.” New research jointly conducted by MIT Sloan Management Review and Deloitte Digital, however flies in the face of this advice: The report found that “digitally mature” companies are more likely to focus on the big picture. But if the big picture is the key to successful digital transformation, is “starting small” no longer a viable option? Senior News Writer Nicole Laskowski discusses in this a TotalCIO blog post.
SearchCIO Features Writer Jason Sparapani recently traveled to sunny San Diego for the Gartner Catalyst conference, where he was enraptured by a presentation by communications expert Mark Jeffries. Sparapani called Jeffries’ lively, one–hour discussion on the mechanics of networking and influencing others “pure gold for CIOs.”
Having to go to San Diego for work doesn’t strike many people as much of a chore. “Oh, lucky you!” they say. “You have to go to the beach.” Others shout out a list of attractions: “The U.S.S. Midway! Balboa Park! The zoo!”
I didn’t get to see any of those hotspots on my two and a half days there. I saw the inside of the cavernous Manchester Grand Hyatt, which hosted the annual Gartner Catalyst Conference for IT professionals. It was a great event. I talked to dozens of smart people, went to technology sessions packed with useful information and dashed off a story about the opening keynote speech in my hotel room, which had a stunning view of the bay. Again, great, but no walk on the beach.
So at the end of my last day in that sunny metropolis, I was looking forward to a talk by communications expert Mark Jeffries. He had been a stockbroker and TV host and now gives presentations all over the world, tempering tips about being a good listener with jokes and campy impressions. Best of all, his talk promised to be light fare. “I’m honored to be your Catalyst afternoon speaker,” Jeffries said in a bright English accent, “the speaker that leads up to alcohol — that’s always a good thing.”
But diverting as it was — and despite my being off-duty — I found myself taking notes. It was pure gold for CIOs. In a lively, one-hour talk, he walked a ballroom full of IT people through the mechanics of networking and influencing others. My co-worker, Nicole Laskowski, wrote in her column about three truths about communicating — assumptions, Jeffries called them — that double as tips. The first one: No matter what your job is, you’re a salesperson. People are looking at you all the time, judging you — and deciding whether to buy.
“You’re judging me right now. I’m also judging you,” he said. “Right now I quite like what I see — primarily because I’m being paid to be here.” Raucous laughter followed.
Jeffries does that a lot. He puts a twist on an old standby — sell yourself — and then puts everyone in stitches. He also laces his speech with rhetorical devices such as the “rule of threes,” which holds that three is just the right number of proofs people need to be convinced. Jeffries let the audience in on the secret, using snippets of President Barack Obama’s speeches as examples — “We’ll reach for it, we’ll work for it, we’ll fight for it.”
It worked. The audience was rapt as he ticked off a list of steps detailing effective communication: LWAR, which stands for listen, watch, anticipate and respond. Note the triplicate: “By respond I mean pick up the phone, create the email message, send the instant text message — that’s the respond, the beginning of communication.”
But people get the order wrong, he said. “We’re so focused and determined to tell people our story, about what our idea is, we speak first … and we shouldn’t.”
He used a scenario that happens to so many: forgetting a person’s name immediately after it’s been given.
Jeffries asked an attendee in the front row to stand, turn toward the audience and say his name. It was Dave. “Now If I said to you [that] at the end of this speech I will give you $10,000 if you can remember Dave’s name, guess what?” Jeffries asked. “You’d all remember his name, because you want that 10 grand. You’re going to turn the listening on.”
Next came W, watch. When someone speaks, Jeffries said, that’s not the whole message. People transmit a lot about what they’re thinking at the moment through body gestures and movements. One way to tell whether the person you’re talking with is engaged is a metric called NPM, or nods per minute. When you’re talking and your partner is nodding, that’s good.
“If the nodding stops and it’s replaced by a kind of glassy-eyed horse stare, something’s gone wrong,” he said to more yuks. “If you see the nodding stop, change topic, let them ask questions.”
A, for anticipate, Jeffries said, is about putting yourself in other people’s shoes — something IT needs to pay careful attention to. “We have got to stop thinking about what [IT’s] priorities are, within the team, within the operation, within the function,” he said, relying again on repetition. Instead, IT folks need to think about the business and speak the business language.
“You have to know exactly what the objectives of the business are. And you translate what you do into their language and suddenly you’ve anticipated their needs.”
Now it’s time to respond. Communication can’t go on without it. Jeffries is just telling you to stop and think for a moment. It’s good advice — and you don’t need to be an IT executive, you don’t need to be a TV host, you don’t need to be a professional keynote speaker to put it to good use.
To borrow a line from Jeffries, see what I did there?
Executives — including CIOs — are under pressure to deliver from their first day on the job, according to Diana Bersohn, managing director, Accenture Strategy and author of the 2015 paper Go Live on Day One: The Path to Success for a New CIO. In this Q&A, Bersohn shares her thoughts on why the first few months of the CIO job are so critical and what new CIOs need to accomplish to put themselves on a path to success.
Informatica Corp. is making a big push into cloud products and subscription-based services, and newly crowned CIO Ginna Raahauge is ready for the challenge. In this interview with Senior News Writer Nicole Laskowski, Raahauge discusses her strategy to jettison the more traditional CIO role for something more akin to what Forbes’ Peter High dubbed the “CIO-plus” role. Raahauge also talks about how the cloud will play a big part in the Informatica’s goal to align IT and corporate strategy.
Stockbroker-turned-communications-expert Mark Jeffries has some advice for CIOs who want to become better leaders: learn to be great communicators. At the recent Gartner Catalyst conference in San Diego, Jeffries provided three tips to keep in mind when relaying information to staff and business peers.
Features writer Jason Sparapani was also in San Diego for Catalyst and talked with attendees about the top tech-specific takeaways from the conference. IT professionals gathered at Catalyst to bone up on bleeding-edge technology, and the cloud and mobility remain major issues for those in attendance.
Questions about ethics and morals abound after the hack of cheating website Ashley Madison, but some claim the salacious headlines are ignoring the real issue: a complete lack of consumer privacy despite numerous breaches of big-name companies in recent years. Will the Ashley Madison hack finally make companies pay attention to privacy protection? Also in this week’s SearchLight: Amazon’s data-driven motivation tactics under scrutiny; and Target Corp. reaches breach settlement with Visa.
IT spending for small and medium-sized businesses worldwide is set to reach $597 billion this year, according to Techaisle LLC, an SMB IT market research firm. In this CIO Symmetry blog, site editor Fran Sales digs into the findings, including Techaisle’s prediction that U.S. SMB IT spending will reach $180 billion this year.
In this week’s ITCompliance GRC news roundup, Sales looks at recent moves by the U.S. Securities and Exchange Commission, including the agency’s approval a contentious executive pay disclosure rule first introduced by the Dodd-Frank Act five years ago.
And finally, industry experts predict Windows 10 will become the leading OS for enterprises. But will businesses agree to jump on the bandwagon? Join SearchCIO’s #CIOChat Wednesday, Aug. 26, at 3 p.m. EST, to discuss whether enterprises are ready to upgrade to Windows 10.