Your real competitor will soon be on the other side of the world...
Major economic growth projected for regions such as Southeast Asia will reshape the technology models companies adopt and transform the role of CIO itself. Mark Samuels reports.
Economic recovery usually leads to an upsurge in investment in Western economies as businesses aim to start growing again. This time it is different, says esure head of IT and operations Mark Foulsham.
Two years after the UK recession of 2009, Foulsham believes the recovery is much slower than might have originally been expected. Proof comes in the form of economic indicators, with the Office of Budget Responsibility downgrading UK growth projections for 2011 on three occasions from a high of 2.6 per cent to a current expectation of 1.7 per cent.
The slower rate of growth leads Foulsham to suggest that CIOs need to think differently about the mix between new investments and existing resources. But he believes there are big opportunities for technology leaders who can think about intelligent ways to grow the business through smart IT.
"Consumerisation and commoditisation are about being smart with technology and geared towards the needs of the user," says Foulsham, adding that smart executives will think carefully about how they use small increases in budget to deliver big business benefits. He points, in particular, to the growing emergence of new global economies.
"The growth will be in Southeast Asian markets," he says. "Estimates suggest as much as 70 per cent to 75 per cent of global growth will take place in that region during the next 20 years. If you don't have a good hand there, you won't see significant growth. CIOs need to be prepared to move fast to take advantage of economies of scale. And that is all about creating a componentised IT strategy that makes use of social and cloud technologies to help the business move quickly."
Understanding values and cultures in new markets
Such flexibility also chimes with United Biscuits group IT and lean director Cliff Burroughs, who says being able to understand values and cultures in new markets is crucial. One of his organisation's most crucial partnerships is with TCS. The consumer giant has worked with the external provider on application development for more than five years.
"That's a big statement of faith in the model," he says. "We invest in the relationship. I spend time over in India and encourage innovation and see if they can help us think about new areas of development." Like Foulsham, Burroughs believes IT leaders need to use a componentised IT strategy to move quickly in fast-growing economies.
United Biscuits has recently started using TCS's iON approach, a scalable cloud computing framework for small businesses connected to its Indian operations. The preconfigured iON model deals with a broad spectrum of technology needs, including document management, finance, HR and website services.
"It's a locally provided IT solution," says Burroughs. "We wanted to avoid the heavy start-up commitment. It's more flexible to be able to outsource virtually everything to TCS and the iON solution is ready for multiple locations. The set of features are right for entering a new marketplace."
CIO opportunities to lead the business
Leading-edge work being undertaken by CIOs such as Burroughs comes as a welcome relief to David Smith, chief executive of strategic research firm Global Futures and Foresight. The internationally renowned business expert believes the changing spatial and economic division of labour presents huge issues for many CIOs. However, he believes IT leaders have the opportunity to lead the rest of the business in the right direction.
"A lot of CIOs are now global in their outlook," he says. "They're realising that there are opportunities in the international market and they need to...