The IT Recession Has Ended � And No One Noticed
Oddly enough there are several groups that tend to be slow to react to changing times: large organizations and industry analysts that serve them. I always thought it was an analysts job to look out beyond the next quarter and let people know what was on the horizon. Advising clients on how to cut back on investments, save money by outsourcing, squeeze suppliers, and avoid new technology is pretty good advise if there is a recession going on.
It is horrible advice a year after the economic recession ended and we are now several months into the next IT boom.
Information technology is a competitive advantage. Anyone who thinks otherwise needs to spend a little time talking to companies that are using Salesforce.com for a focal point for sales and customer relations, for example, or investigate companies like CarFax.com to see how you can sell data online. Or start a blog and begin to connect to your customers using, of all things, technology.
Do you have doubts that IT spending is on the rise? Have you looked at Dells, HPs, IBMs results? Those are lagging indicators. Have you read Rich Karlgaard s column that appeared last week in the Wall Street Journal? He is my all time favorite technology prognosticator (apologies to George Gilder).
In that column he points out that the second wave of the Internet is cresting. Did you notice that postings for internet engineering positions at Craigslist.com turned around almost two years ago and are approaching their 2000 levels?
Have you clued in to the stealth startups out there? I dont know what the heck 24HourLaundry.com is all about but I do know to pay attention to Mark Andreesons new gigs.
Did you know the word on the street is that launching a new Web application has gotten much less expensive?: tens of thousands instead of millions of dollars. Look at Drupal, or EZPublish if you want to be amazed at what can happen in days if you use these open-source content management solutions.
Product discussion forums? Interactive document creation (wiki)? User blog sites? Catalogs? Shopping carts? Podcasting? No problem. These things are easy to do. I can do it. I had to brush up on a few Unix commands and I needed a cheat sheet to use a screen editor (remember Pico?) but a test site went up in two hours.
The only drag I see on the IT economy right now is Sarbanes-Oxley. My advice to the overworked IT people struggling to put in ridiculous document systems to track the silliest changes: get beyond this as soon as you can.
Use technology to make SOX bearable. It's time to start thinking about ways you can help your business with technology. Do you still have cumbersome architectures on your Web apps? Did you invest too much in your last Web site make over? Are you reticent to go back and make it really good this time because of the cost? Get some bids. You will be very surprised at what can be done this time around. And it can be done securely, too.
For the lucky private companies and European and Asian companies that are not engaged in SOX hopping now is your chance to leverage technology to get the jump on your big U.S. publicly traded competitors. Use technology to become more efficient and expand your business. Hire away their IT staff who are probably logged in to Craigslist right now looking for a job that is productive!
Its not a bubble, there are no sock puppets, this is real. Do you still have that automatic reduction of five percent in your spending budget for 2006? Revisit that right away. Assign someone right now to start reviewing all those proposals that were put on hold because of spending restraint.
My own prognostication: an IT boom is starting that will see a transformation in the way business is done that rivals the late 90s. New tools and technology are available right now to make this happen. Productivity will increase in real terms in direct proportion to technology spending. This is real. You heard it here first.
Richard Stiennon is vice president of Threat Research at Webroot Software. He is a holder of Gartner's Thought Leadership award for 2003 and was named "One of the 50 Most Powerful People in Networking" by Network World Magazine. You can read his blog at www.threatchaos.com.