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4 Forces That Will Shape IT Economics In 2012

Major forces are blowing apart traditional models of managing a firm's technology and related economics.

While most firms in financial services are focusing on the "headwinds" of global market uncertainty and regulation, there also is a real need to look "under the hood" at the enterprise/business technology engines that drive operational efficiency, enable product innovation and deployment, and enact risk/regulatory compliance.

Since the economic upheaval began in 2007-8, it has been clear that the historical models of managing a firm's technology and related economics don't fit with the new economy or the "new normal." Now it is even clearer that four major forces are at work to blow them apart as the winds of change in the technology economy:

1. Relentless Demand for Technology
2. Upward IT Spending Pressure
3. The Need for New Management Models
4. Transition Business Models

1. Relentless Demand For Technology
The demand for "computing"--processors, storage, network bandwidth, access via alternate devices--is growing faster than the global economy and faster than can be offset by Moore's Law.

2. Upward IT Spending Pressure
With the force of technology demand blowing by the economics of Moore's Law, we now have entered an era in which such upward technology pressure (and expense) will continue to increase in all possible business scenarios--whether revenue increases, decreases, or stagnates. Add to this the new demands of risk management and regulation, and there just is no escape from the pressure of rising IT costs.

3. Adapting Management Models To The New Rules Of The Technology Economy
Neither technology nor business management (or government) are prepared to operate under the "rules" of the new technology economy (or know how to).

Read the rest of this article on Wall Street & Technology.

Predictive IT analytics can provide invaluable insight--vital if a private cloud is in your future. Find out how in the new, all-digital Predictive IT Analytics issue of InformationWeek. Also in this issue: Randy Mott named CIO of General Motors, how Dell is pushing into the enterprise data center, and eight key features in Windows 8. (Free registration required.)

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