Ravi Shekhar Pandey, manager, syndicated research, Springboard Research
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| Countries most affected by the recession will be mature IT markets in export-oriented economies like Korea and Taiwan, and countries heavily-dependent on the financial services industry like Hong Kong and Singapore. | ||
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Q: What technology innovation or product are you looking forward to next year?
While there have been many IT innovations that help companies manage growth and a peak in demand for the products or services, there are very few innovations that can help companies address challenges arising out of drastic changes in the business environment.
I believe that 2009 will see more of technologies and solutions that can help companies cope with downturns and manage risks associated with changes in economic environment in a better way.
I think IT companies can help business design a solution that can simulate different business and economic environments for them and how would that impact their business--for instance, how would a chip manufacturer get impacted if there is a 1 percent drop in retail purchases in the United States or a 1 percent drop in economic growth in China? Such a solution would help them manage a crisis like situation better.
Was there a technology release which failed to live up to its hype and disappointed you this year?
There were no disappointments as such, but there was definitely a lot of hype around cloud computing, green IT and virtualization. However, we believe it's typical for technologies to go through a period of hype and we expect these technologies and concepts to do well in 2009.
What are some challenges which will IT departments next year, and will there be any new challenges?
As companies look at curtailing investments and controlling costs, some of the biggest challenges of IT departments will be around spending.
However, the key challenge for them will be to help their organizations grow their markets and sustain profitability in a difficult economic environment. Given that, CIOs will have to operate with reduced IT budgets but heightened expectations to deliver more.
There would be more focus on innovation. However, innovation will not always come easily and may take a much longer time the most organizations would expect or want. We believe that creating innovative IT solutions and practices will be the biggest challenge for IT departments and those who focus on innovation will emerge stronger at the end of the economic crisis.
But it is unlikely that innovation will be a widespread phenomenon--many companies will continue to depend on conventional ways to come out of the crisis.
What are some expected effects of the recession on business?
Certain countries like India and China will continue to grow, albeit at lower rates. This relative strength in IT spending will help to power the growth that we will see in the region and increase their primacy in the Asia Pacific-IT market at the expense, in particular, of Australia and Korea.
The most affected countries will be mature IT markets in export-oriented economies like Korea and Taiwan, and countries heavily-dependent on the financial services industry like Hong Kong and Singapore.
Thailand will experience significantly slower growth as it deals not only with the economic crisis, but its ongoing political troubles that have increased business uncertainty in the country. Indonesia and Vietnam will be less affected as the combination of limited existing IT investments and solid domestic demand will ensure ongoing IT spending.
We also believe that as technology has permeated far deeper into businesses' operations over the past 7-10 years and while it is a much larger component of most organizations' total spending, it has also become crucial to increasing efficiencies, competing in an increasingly globalized market, and expanding revenues.
Springboard therefore believes that while technology spending will definitely be affected by this crisis, it will be more resilient than other areas that are often easier and quicker to cut.
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