Tech: what comes next - CEO Agenda 2004 - information technology outlook

Chief Executive, The, Dec, 2003 by Irving Wladawksy-Berger

Now, more advanced technologies, open standards and communications networks will permit businesses increasingly to fuse processes within the enterprise and beyond. As that fusion proceeds, companies are likely to decide which processes offer the efficiencies inherent in scale and match with their unique expertise. In a phrase, they will determine which processes give them "economies of expertise." These key processes would clearly be growth areas in which a business would invest. Ancillary processes would be obtained from others.

Economies of expertise are already appearing. IBM, for example, will provide human resources support for nearly 98,000 employees of a major consumer products company in almost 80 countries, services such as payroll processing and compensation planning. The consumer products company will focus on those processes in which it realizes its own economies of expertise.

As a consequence of economies of expertise and a flexible, open IT infrastructure linked to the Internet, the best processes will become quickly available worldwide. And this capability in turn will generate "industry ecosystems," affording businesses access to expert business processes from a partner or service provider.

Today's business pioneers are moving quickly to realize the huge opportunity created by the marriage of business and technology to tap both economies of scale and economies of expertise. The time for throwing random technologies at business is long gone. After years of experimentation, we are learning how to empower businesses to truly exploit the power of technology.