Tech On A Roll

As shown on the left, Forrester expects the global tech economy to continue growing at fast rates. This is another signal to CEOs of all stripes that they should push to make their businesses increasingly digital and aligned with technology markets. Yes, Jeff Bezos sells books and Tony Hsieh sells shoes, but their advanced technologies give them enhanced growth and higher capitalization values for their companies...
 
Why is tech so healthy? It's a different story depending on where you sit. In the "Tech Twelve" (Canada, the US, Denmark, Finland, the Netherlands, Sweden, Switzerland, the UK, Israel, Australia, Singapore, and New Zealand),  the early adoption of fourth wave systems like smart computing,  app Internet, and cloud computing is fueling growth. In these countries, tech is driving GDP. But in the BRIC countries (Brazil, Russia, India, and China) the reverse story holds. Strong GDP growth is stimulating and necessitating higher tech spending.
 
CIOs tell us that both hardware and software spend is driving this growth. 35% of technology decision-makers will spend more on hardware this year than they did in 2010, while 34% will spend more on software. Our forecasts predict that computer equipment and IT consulting and systems integration services will be the leading categories of tech growth. Close behind are software and IT outsourcing services.
 
What's your theory on why tech is doing so well? I'd love to get your thoughts.

Comments

Why tech is doing so well?

It's not the total answer, but it seems one major driver is the fact that there are more people than ever before with so many more digital devices of all types creating so much content of all flavors -- texts, photos, videos, audio -- all flying through every kind of network (wired and unwired) imaginable. That requires more chips, systems software, network equipment, storage solutions, along with all the stuff needed to keep those things up and running.

As for specific markets that will increasingly adopt a lot of new technology, online advertising seems one industry poised for big growth. At last week's AlwaysOn OnMobile breakfast briefing at SAP America headquarters in Palo Alto, Tony Perkins of AlwaysOn noted that of the total $50b spent in 2009 on advertising of all kinds, only 13% of it was spent on online advertising despite the fact the Internet is where we spent 28% of our time consuming media. TV got 39% of the 2009 total ad expenditure and 31% of our media consumption time; print was 26% of the dollars, and 12% of our media consumption time; and radio got 9% of the dollars, and 16% of our time.

Seems like one trend will be for marketers, advertisers and ad agencies to adopt a lot of new online technologies to take advantage of all this time we're spending online!

Much like the sabermetrics folks infiltrated baseball, expect the statistics people move aggressively into advertising!

Ignore Technology at Your Peril

Yes, it is the tech-savvy executives that drive their companies forward at a pace that others completely fail to understand. But let me say that the tech-savviness is usually linked to a different management mindset that helps the business in other ways too. These executives have given up a command and control attitude and utilize technology to empower employees to deal with empowered customers. The two big trends of SOCIAL and MOBILE are aligned and fuel each other. MBA-trained business management is currently utterly unable to keep up with the real-time aspects of that and has no idea how to align business strategy, planning, budgeting and monitoring.

The biggest challenge? Not hardware and bandwidth. It is software development that can keep up with that frantic pace, transparency and where needed - compliance and auditability. I propose that while Cloud-enabled mobile apps that apply social concepts are at the forefront of that change, they are also its biggest issue.

The future will have to be a model-driven, business-architectured app infrastructure that does no longer require software to be coded, but enables real-time empowerment for executives (define objectives), management (monitor targets), process owners (assign goals), performers (execute) and consumers (expect outcomes). Some of that will have to be supported by machine-learning technology (AI) that learns the complex patterns of processes und human interactions that evolve.

Next to executives who lack technology understanding, the biggest problem today is IT-people who are worried about their jobs and protect the status quo, analysts who purely report on market statistics, and the media who hype-up each and every crap coming their way. But such is life and there is no sense in moaning about it.

Current management concepts and BI data-illusions have led to the financial crisis. It will be interesting to watch how that will play out while governments and global CEOs pretend to know what they are doing, while hiding a still ticking financial time-bomb. Yes, exciting times coming our way ...

Thanks, George. As always, far-sighted commentary.
Regards, Max J. Pucher
Chief Architect ISIS Papyrus
http://www.adaptive-process.com

Tech is again the disruptive change in society

The only way leading economies (like say the US) can keep their noses front is through disruptive technologies. It is innovative companies like Apple or Google or Facebook that create products and services that touch the lives of everyone from suburban India to Manhattan. The growing influence of the growing middle class in the BRIC countries is undeniable. It is through innovation that the West can sell products to this growing middle class in the BRIC countries. So tech has to be THE fastest growing sector in the west.

In the BRIC countries, deep rooted centralized control social and political structures are changing and this this happening inspite of these centralized control structures and not because of them. They will copy the Apples and Googles and Facebooks. They will have extended arms of these countries. So outsourcing will still thrive in these economies. As the middle class grows in these economies, the tech spending has to raise so they have access to the latest innovation from the Western companies as well as from their own companies that will grow to challenge the Apples and Googles and Facebooks.

Very interesting times...

Why tech is doing so well?

No one wants to be left out. Fear and/or potential earnings would be the shortest expression of why tech is doing so well.