Published on the 26/03/2014 | Written by Newsdesk
Seven out of ten CIOs will switch vendors in the next two to three years as they struggle to keep pace with both changing technology and sectoral shifts…
A global CIO survey conducted by Gartner’s Executive Programs has found 70 percent of chief information officers expect to change technology and sourcing relationships by the end of 2016.
The looming vendor churn is the result of the predicament that many CIOs find themselves in today – swamped by demand and struggling to meet it.
CIOs are expected to keep current systems up and running; rapidly roll out new platforms that can support the “digitisation” that many companies are going through; and also respond to the consumerisation trend where employees are bringing their own technology and apps to work while senior executives are buying in cloud services as point solutions for particular problems.
If their current vendors can’t help them navigate the maze, they will look elsewhere.
Gartner said that although this poses challenges for technology service providers, it was also an opportunity for those able to work closely with IT executives to better understand their business challenges and find solutions to meet them.
But it will necessitate a new way of selling. According to Eric Rocco, managing vice president at Gartner, successful IT service providers will in the future; “Articulate value in business terms such as key process outcomes and impact to key performance indicators (KPIs). Doing so requires deep vertical industry knowledge, and new go-to-market models.”
It’s a change that will also impact the shape of the IT services marketplace itself. So although the overall IT services market is forecast to grow by 4.6 percent in 2014 growth in hardware support will be sluggish while infrastructure as a service and business process as a service will soar by 44.9 and 12.4 percent respectively in 2014.
And Gartner argues companies will be selecting cloud solutions for the agility they promise rather than cost savings.
It demands a new approach from vendors says Rocco; “The strategic challenge facing service providers is to better understand client value drivers, and to more effectively articulate their own value propositions.”
Companies needed to demonstrate visionary thinking to their clients and prospects and to articulate value in terms of client business outcomes and KPI attainment he said.
