CIOs intend to change their technology and sourcing relationships soon: Gartner

Nurdianah Md Nur

Seventy percent of CIOs are planning to change their technology and sourcing relationships in the next two to three years to adjust to a digital future, according to research firm Gartner.

"Digital business is an unstoppable and irresistible catalyst for change that will affect the fundamental foundations and baseline assumptions of every business," said Eric Rocco, managing vice president at Gartner. CIOs are shifting to service providers that are able to help them respond to the business and IT opportunities brought about by the digital business revolution underpinned by the Nexus of Forces (cloud, social, analytics, mobility and the Internet of Things), he added.

"Most buyers cannot simply adopt new services without making changes to existing processes and applications," said Rocco. "Buyers want speed and agility. They recognise an innovation crisis exists internally, but few service providers are well-positioned to capture the opportunity." 

Technology and service providers of the future therefore need to be able to demonstrate how their offerings can support, enable and accelerate the business digital revolution to remain relevant to their customers. They should be able to "articulate value in business terms such as key process outcomes and impact to key performance indicators," when marketing their offerings, said Rocco.

Expected growth of the IT services market
Even though the Nexus of Forces is driving changes in the enterprise, not every aspect of the business will need to change to the same degree. Gartner predicts that even though the overall IT services market is expected to grow by 4.6 percent this year, the growth will be uneven.

Cloud-based infrastructure as a service (IaaS) and business process as a service (BPaaS) are forecasted to be the two fastest growing segments in 2014. According to Gartner, cloud-based services will be increasingly adopted not due to expected cost savings but their ability to enable organisations to be as agile as possible.

Hardware support, on the other hand, is predicted to be among the lower-growth opportunities in the IT services market.