The pace of technology innovation has outpaced IT’s ability to deliver what their customers expect. Recent surveys by Gartner, Forrester, and McKinsey clearly show how business users are favoring technologies that do not depend on IT. A recent survey conducted by Gartner shows that 30% of users are unhappy with the slow rate of IT change at their companies and this number is suppose to climb to 50% by 2013.
Forrester surveyed marketing managers and 70% of marketing managers were unhappy with their IT departments and preferred to rely on a marketing service provider or consulting organization to help them build and manage their systems.
IT’s lack of resources and ability to adapt to change and to new technologies is also captured in the growth of SAAS deployments over the next few years. Recent research by Gartner shows how customers spent $1.7 billion on content, social software, and collaboration SAAS based tools in 2007. The number jumps to $3.6 billion by 2011. That is a 25.9% growth rate. It is also the same is the same for CRM, the SAAS CRM market has grown from $1 billion in 2007 to $2.4 by 2011.
Just in the social software market alone 80% of the vendors are SAAS or hosted. On premise solution vendors cannot catch-up with the speed of change and have become the minority.
A study by McKinsey shows how CIO’s are adapting to meet their customers demands, and they are seriously considering different options.
In 2006, 38% of CIO’s considered adopting SaaS and today the number has jumped to 61%.IT departments will need to change to stay ahead. SAAS is likely to be the next big trend for IT departments who are trying to cope with their overwhelming user needs. In the end the customer will prevail. They will do this with or without IT, and IT better change in order to continue to stay relevant.