As many as 70% of CIOs intend to change their technology and sourcing relationships in the next two to three years, according to new survey results from Gartner.
A variety of reasons were cited by CIOs from around the world. Still, there is a common theme among these reasons, and it’s basically about clients’ current providers not being able to adapt to change.
“The picture is clear for service providers as clients are struggling to keep up with change,” said Gartner managing vice president Eric Rocco. “They are strongly considering changing the providers they work with as part of responding to this change. Market share will shift to service providers able to help clients respond to the business and IT opportunities and challenges that are overwhelming more than half of organizations today. Service providers need to convert this picture into an opportunity rather than a threat.”
“Digital business is an unstoppable and irresistible catalyst for change — change that will affect the fundamental foundations and baseline assumptions of every business,” he added. “The digital business revolution is underpinned and enabled by the macro technology forces of cloud, social, analytics, mobility and the Internet of Things. Not every business fundamental will need to change to the same degree, nor will every technology driver have a role to play in every business scenario; however, businesses that decide to ‘wait and see’ are likely to become irrelevant.”
The firm projects the IT Services market to grow 4.6% this year, but notes that the entire industry won’t grow uniformly. Hardware support, for example, isn’t expected to grow as much as say, cloud-based infrastructure as a service (IaaS) and business process as a service (BPaaS), which are the two fastest-growing segments. This year, these two are projected to grow by 44.9% and 12.4% respectively.
The report points out that cloud-based services are cannibalizing more traditional models, but the driving factor of this is agility rather than cost.
You can find the full report here. Gartner is also hosting Sourcing & Strategic Vendor Relationships summits in June and September, where it will discuss issues facing the IT services industry.
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