Worldwide Enterprise Software Revenue to Grow 9.5 Percent in 2011

Worldwide enterprise software revenue is on pace to surpass $267 billion in 2011, a 9.5 percent increase from 2010 revenue of $244 billion, according to Gartner, Inc. The enterprise software market is projected for continued growth in 2012, with revenue forecast to reach $288 billion.

Enterprise infrastructure software spending is on pace to a $153.3 billion total in 2011, a 9 percent increase from 2010 revenue of $140.6 billion. The market is led by the operating systems (OS) segment in which revenue is projected to reach $32.6 billion in 2011, followed by database management systems (DBMSs) revenue at $25.5 billion.

Worldwide enterprise application software spending is forecast to total $114.4 billion in 2011, a 10.2 percent increase from 2010 spending of $103.8 billion. Enterprise resource planning (ERP) is the largest segment within the enterprise application software market. ERP revenue is expected to reach $23.3 billion, followed by office suites with $15.7 billion.

Emerging countries such as Poland, India, China and Brazil, which were less affected by the latest economic downturn than the U.S. and Europe, are expected to continue to invest heavily in enterprise software initiatives in the next few years as they build the IT infrastructures necessary to do business on a global basis.

Enterprise software spending in North America is forecast to reach $121.2 billion in 2011, up from 2010 revenue of $112.9 billion. The market will experience consistent growth through 2015, when spending in North America will surpass $158.1 billion.

Gartner believes that oil prices and the outcome of the federal budget deliberations are the largest threats to economic stability in North America. However, current indicators are positive with consumer and business spending on both equipment and software holding up. With the extension of federal tax cuts —including the tax relief on capital equipment depreciation —due to expire at the end of the year, additional stimulus revenue could further boost enterprise spending on technology and other capital goods.

Enterprise software spending in Western Europe is forecast to reach $78.3 billion in 2011, up from 2010 revenue of $70.3 billion. The market will experience growth on a par with North America through 2015.

Asia/Pacific (excluding Japan) will have the second fastest growth, after Latin America, in enterprise software revenue of all the regions in 2011. Spending is forecast to reach $26.4 billion in 2011, up from 2010 revenue of $23.6 billion. The market will experience strong growth through 2015, when spending in Asia/Pacific will surpass $40 billion.

More information on enterprise software can be found at www.SupportIndustry.com.

Survey Shows Expectations of IT's Strategic Contribution Will Double for 2012

In the midst of a belief that tough times lie ahead, more boards of directors are saying that they expect a high to extremely high strategic contribution of IT in 2012, according to the Gartner Forbes 2011 U.S. Board of Directors Survey. The expectations of "high" to "extremely high" strategic contributions of IT climbed from 32 percent of survey respondents for 2010 to 66 percent for 2012.

From October to December, 2010, Gartner and Forbes surveyed 96 company directors. The Gartner Forbes 2011 U.S. Board of Directors Survey was designed to gain insight from a group that has low visibility to IT and business leaders, yet is ultimately held accountable for the performance of the corporation. The survey examined the key business issues and priorities of a sample of directors from companies with revenues over $1 billion, their view of what is ahead for their businesses, and their expectations for IT's strategic contribution to the business.

While 73 percent of board directors surveyed believe that the economic situation is tough and will remain so for the foreseeable future, 51 percent said they are still focused on growing revenue. The tension between these two views means that CIOs will need to plan for the systems that will be required for growth but build in flexibility should circumstances change amid high levels of uncertainty.

One of the goals of the survey was to test how board directors view the different business issues in front of them. The hypothesis was that board-level issues, such as corporate governance, would rank highly, along with the issue of corporate social responsibility, such as workforce diversity, instituting green policies and philanthropic activity. However, in listing the top 28 priorities, there was a clear delineation where business priorities fell into three distinct groups:

-- The Top 12: The Business Performance Block -- This top-ranked list was dominated by issues that have a direct connection to revenue and profit.

-- The Middle 8: The Board Policy Block -- This list was dominated by issues that concern the board directly, such as instituting or strengthening corporate governance.

-- The Bottom 8: The Social Responsibility Block -- This list contained "green" policies, corporate social responsibility and philanthropic activity, and political lobbying.

More information on IT can be found at www.SupportIndustry.com.

Survey: CEOs plan to boost hiring, spending

A majority of America’s largest companies are ready to step up hiring this year and more than 90% expect sales to improve, a survey found.

The Business Roundtable said that 52% of its members plan to increase hiring in the next six months. That’s the largest proportion for the group since it began surveying its members nine years ago. The trade group represents CEOs from roughly 200 of the nation’s largest companies.

More than 60% also plan to spend more on long-lasting manufactured goods, such as computers and machinery, according to the survey of 142 executives taken in early March.

The group’s members are more optimistic than at any point since the survey began in 2002. Its CEO economic outlook index rose to 113, up from 101 in the previous quarterly survey. The index plummeted to -5, its lowest level, in the January-March quarter of 2009.

Still, the executives expect the overall economy to grow only a modest 2.9% this year. That’s up from their forecast three months ago of 2.5 %.

source: USA Today

More information on the service and support industry can be found at www.SupportIndustry.com.

Key Elements of an Effective IT Governance Process

To successfully implement IT governance, chief information officers (CIOs) require both leadership and execution, according to Gartner, Inc. Great IT leaders master process, and they understand that executing governance programs involve process, discipline and creativity.

Gartner analysts said that to deliver successful governance CIOs need to manage two dimensions of governance. First, governance is a decision-making framework that reflects the organization’s goals and priorities, and how the organization intends to achieve them. Second, governance processes, covers the structures and methods the organization uses to execute and institutionalize the governance framework. In essence, the framework is what the organization has decided, while the process is how the organization will institutionalize those decisions.

Among the critical standing governance success factors is ensuring that participants occupy optimal roles. The governance role most appropriate for individuals derives from their position in the organization and specific skill set. This approach helps CIOs match stakeholders to their optimal enterprise roles.

CIOs also need to bear in mind that the ability to fill a recommended role varies with an individual’s skills, interests and the enterprise environment, with some people performing adequately and others doing much better. If current roles do not match the tool’s recommendations but governance still delivers expected benefits, CIOs should not make any adjustments—because outcomes always come first.

In addition, integrated communication is important to governance decision input and decision execution. However, failing to communicate is a common governance pitfall. Governance bodies struggle with decision making when they lack appropriate information. Stakeholders, in turn, struggle to comply with poorly communicated decisions. To facilitate and communicate decisions more effectively, governance communications should use the same business outcome metrics, prioritization scoring systems and milestone metrics throughout a project’s life cycle. CIOs also need to inventory their communication tools when they notice lack of compliance with governance decisions or excessive revisiting of established decisions.

More information can be found at www.SupportIndustry.com.

CIOs Reveal Hiring Projections For Third Quarter: Survey Finds High Confidence in Business Prospects and Planned IT Investments

Technology executives forecast continued information technology (IT) hiring activity in the third quarter of 2011, according to the just-released Robert Half Technology IT Hiring Index and Skills Report. In the latest quarterly survey, 7 percent of chief information officers (CIOs) said they plan to expand their IT departments, and 3 percent expect cutbacks, for a net 4 percent projected increase in hiring. Eighty-seven percent of CIOs are confident in their companies' growth prospects in the next three months, a seven-point increase from last quarter.

The IT Hiring Index and Skills Report is based on telephone interviews with more than 1,400 CIOs from companies across the United States with 100 or more employees. Executives are asked whether their companies plan to increase or decrease the number of full-time IT personnel on their staff during the coming quarter. The survey is conducted by an independent research firm and developed by Robert Half Technology, a leading provider of IT professionals on a project and full-time basis. Robert Half has been tracking IT hiring activity in the United States since 1995.

Key Findings

-- The net 4 percent increase in anticipated IT hiring activity is down from a net 7 percent projected last quarter. However, executives' confidence in business growth and IT investments is rising.

-- Eighty-seven percent of CIOs are confident in their companies' growth prospects in the next three months, a seven-point increase from last quarter.

-- More than half (55 percent) of technology executives rated the confidence of their firms investing in IT projects in the third quarter a 4 or higher on a 5-point scale, with 5 being the most optimistic. This is up seven points from the last quarter.

-- Technical support and networking professionals are in greatest demand right now, according to survey respondents.

-- Forty-eight percent of CIOs said it's challenging to find skilled professionals today, up five points from the previous quarter.

Confidence in Business Growth and IT Investments

Eighty-seven percent of CIOs reported being at least somewhat confident in their company's prospects for growth in the third quarter of 2011; 55 percent rated the probability of investing in IT projects a 4 or higher on a 5-point scale, with 5 being the most optimistic.

Skills in Demand

The functional areas in which executives interviewed foresee the greatest challenge in finding skilled IT professionals are networking (21 percent) -- up from 13 percent last quarter, and security (16 percent). Applications development and help desk/technical support followed, with 14 percent and 12 percent of the response, respectively.

Network administration remains the skill set in greatest demand, cited by 68 percent of CIOs. Desktop support ranked second, with 66 percent of the response, followed by Windows administration at 56 percent.

Regional Outlook

CIOs in the Mid-Atlantic(1), Mountain(2) and Pacific(3) states are leading in terms of plans to hire staff in the third quarter. Seven percent of executives plan to add IT staff and just 1 percent expect cutbacks in each of these regions.

Industries Hiring

The retail and manufacturing sectors are tied for the lead in terms of hiring expectations. Nine percent of CIOs plan to expand their IT departments and only 1 percent anticipate staff reductions in both industries. Executives in the professional services industry and the transportation, communications and utilities sector each forecast a net 5 percent projected hiring increase. 

More information on IT hiring can be found at www.SupportIndustry.com.

Nearly 85% of U.S. Businesses Ready to 'Weather the Storm' Due to Planning: AT&T Study

As Midwesterners survey the wreckage from last week's deadly tornadoes and the Southern states recover from April's devastating rain storms, the importance of business continuity and disaster recovery efforts is a topic that remains close to home for businesses and organizations across the United States.

A recent study by AT&T found that:

-- 84 percent of executives have responded to the need to prepare for disasters by implementing business continuity plans – an increase of 12% in over the past five years.

-- Nearly two-thirds (65%) of companies take specific actions to protect their employees and businesses when the government issues an alert for an impending emergency – up 31% in the same timeframe.

These results from AT&T's annual business continuity study reveal a trend towards greater emphasis on planning and responding to potential threats. AT&T has conducted this study for ten consecutive years, surveying IT executives from companies in the United States with at least $25 million in annual revenue to measure the national pulse on business continuity planning.

2011 AT&T Business Continuity Study Key Findings

Evolutions in technology and recovering IT budgets have enabled businesses to investigate new means for maintaining critical operations in the face of natural or manmade disasters.

-- Eight out of ten (80%) executives indicate that their companies will be investing in new technologies in 2011, up from 72% in 2010.

-- A majority (54%) of organizations surveyed currently use or are considering using cloud services to augment their business continuity and disaster recovery strategies.

-- Use of mobile devices plays a role in 78% of business continuity plans.

-- Most companies (80%) have systems in place that enable employees to work from home or remote locations, representing an increase of 14 percentage points in the past four years.

The security implications of social networking remain a concern for IT executives, even as their companies begin to integrate these tools into their business strategies.

-- Three out of four (79%) of executives expressed concerns about the increased usage of social networking capabilities.

-- More than half (56%) of companies allow employees to access social networking tools such as Facebook, LinkedIn, Twitter, and YouTube from the corporate network.

-- Two-thirds (67%) of businesses use social media to communicate with customers and stakeholders or to monitor for relevant news and chatter.

Mobility and wireless capabilities carry weight in business continuity planning as well as day-to-day operations for many companies.

-- Six out of ten (64%) organizations include wireless network capabilities as part of their business continuity plan.

-- More than a third (38%) of companies plan to invest in mobile applications during 2011.

-- Most companies (81%) allow employees to access work emails on their personal smartphones.

-- Eight out of ten (82%) of executives are concerned about the potential impact of mobile device usage on security threats.

More information on IT budgets can be found at www.SupportIndustry.com.