2012 IT Outlook - The End Of Business As We Know It

In 2012, we will witness the end of business as we know it. The relationship between technology and business will be inverted. Until recently, technology has typically been designed and implemented in order to support and enable business processes. For example, CRM and ERP software applications were created to improve the performance of existing business processes. In other words, business developments forced change in technology development.

In 2012, technology developments will frequently force change in business processes. This has already occurred in some industries, most notably, the media industry. Personal clouds in which people can stream their own content are forcing enormous change in the media industry. In fact, technology has completely transformed the media industry. The inversion of the relationship between business and technology is driving several key developments that will be apparent in 2012.

Executives in all industries will need to closely monitor the activities of technology firms, particularly Apple, Amazon, Google and Facebook. In addition to forcing change in the retail, travel and hospitality and media industries, 2012 will see technology firms forcing change in other industries. For example, mobile payment products such as Google Wallet enable technology firms to compete with financial services firms and will change the way people spend money.

In 2012, this inversion of the relationship between technology and business, will be primarily driven by three key technology trends. These three 2012 developments are:

• Cloud computing will become mainstream

• Cloud computing will drive mobile computing

• Social media will be widely integrated into business activities

#1 Cloud Computing will Become Mainstream

In 2012, cloud computing is set to become mainstream in Asia Pacific. Indeed, approximately 30% of APAC organizations have already adopted some form of cloud computing.

In 2012, the impact of the shift to cloud computing will become apparent. One of the first obvious effects of this type of technology is the cloud-driven transformation of whole industries such as the media industry and the IT industry itself.

Platform-as-a-service (PaaS) is set to be the new battleground in the cloud computing industry as PaaS vendors seek to attract developers to their platforms. Today, Force.com has an advantage over other platforms as a result of its early entry into the market. However, over the last 18 months or so, new platforms have come online, supported by major vendors such as Microsoft, Amazon, IBM, Red Hat, Google and VMWare. Two or three platforms can be expected to dominate as a critical mass of applications is developed on each.

Cloud brokers will emerge en masse, as organizations seek partners that can customize cloud applications for them. These cloud brokers will typically affiliate themselves with a particular platform such as Force.com. In other words, many more applications will be available from the public cloud and these applications will be much more highly customized than most of today’s cloud applications. In turn, industry fragmentation will occur as many more Software- as-a-Service (SaaS) vendors emerge, many with industry-specific applications. Today’s SaaS offerings are predominantly horizontal.

Private clouds will mainly appear in the form of internal clouds that replicate the offerings of Infrastructure-as-a-Service vendors. Many large organizations will engage in datacenter transformation projects or build new datacenters in order to offer business units access to IT resources. Chargeback mechanisms will be built in, resources will be accessed via browsers and apps and the benefits associated with scalability and rapid provisioning will be integrated. These internal clouds will have most of the characteristics of public clouds.

Cloud computing will have a profound impact on the way businesses operate. The cloud model will engender innovation as well as giving businesses an opportunity to enhance existing business processes, this making themselves more competitive.

#2 Cloud Computing will Drive Mobile Computing

In 2012, more smartphones and tablets will be shipped than PCs and laptops. These devices will continue to offer much richer functionality to the extent that they will displace PCs in many business areas. Already, tablets are being used by front line staff, who previously used laptops, for example, sales staff in car dealerships.

It is the provision of cloud services that is leading to the huge growth in mobile-specific applications and other applications that run on smartphones and tablets.

Executives will drive the move to ‘Bring Your Own Technology (BYOT) as they seek to use their mobile devices in their workplaces. This transition to mobile devices in business environments will be reinforced as other workers follow suit in 2012.

The combination of mobile technology and cloud computing will drive change in business. For example, these technologies will make the provision of point of care solutions in the healthcare sector commonplace. In the airline industry these technologies will lead to much more self service. The full service airlines will emulate self service check-in activities that are typical for many low cost carriers. In fact, self service will become widespread across many industries. Where possible, business will seek to use cloud computing and mobile technology to enable self service.

#3 Social Media will be Widely Integrated into Business Activities

In several Asia Pacific countries, more than half of the working population uses social media. In spite of this development, Asian businesses have taken a very conservative stance towards the use of social media. Most Asian businesses have been more focused on blocking employee access to social media rather than viewing it as a new and powerful way of engaging with customers and other stakeholders. Asian companies have also been cautious in their use of social media because best practice in the use of social media has not been established.

Nevertheless, Asian organizations have started to recognize the importance of Online Reputation Management (ORM). For example, ICICI Bank in India has used social media as a means of understanding customer sentiment towards their brand, product and services. In turn, it has used social media to determine how to improve the company’s reputation and to determine which products and services require most focus in terms of improvement.

Commonly used social media tools such as Facebook, Twitter, LinkedIn, YouTube, and Renren and Weibo in China, have been used for some time for marketing and PR activities. They are now being used to support and enable a much wider range of business processes. For example, more wealth management advice is now delivered using Facebook than by any other means. Both Twitter and LinkedIn are now becoming standard tools for recruitment. 2012 will see this trend continue and develop.

In fact, in 2012, organizations will increasingly focus on integrating social media with its other customer and stakeholder touch points. Social media will be the fourth channel, augmenting face to face contact, voice interaction though contact centers, and interaction through web sites.

Social buying, also known as group buying, has become common in Asia and businesses have rushed to work with both local and international group buying companies to increase sales, acquire new customers and manage inventory. This trend will continue in 2012 and become integrated into overall sales and marketing strategies for a lot of businesses.

In summary, the inversion of the relationship between technology and business will become clear in 2012. Cloud computing, mobility and social media will drive this trend. Each of these trends is a major disruptive force in all industries.

Other notable developments in 2012 will be centered around the growing importance of ‘big data’ and the tools needed to analyze it, mobile payments becoming more common, increased corporate involvement in the burgeoning gaming industry, machine to machine technologies impacting multiple industries and the adoption of Smart TV.