The Leading Edge - Winter 2008 - 9

briefs What to expect in 2008… Tough year predicted for iT leaders Chief information officers will face a “make it or break it” year as executive boards restructure IT departments and reevaluate funding and strategic leadership, according to Nucleus research, a global provider of investigative technology research and advisory services. Among its predictions for this year, Nucleus believes: 1. growing demand for on-demand. Low risk, rapid deployment and low cost means organizations will consider even more hosted and on-demand solutions for project management, content management, e-commerce and collaborative functions. 2. Line of business draws the line. Business users now will drive and manage new technology projects as territorial lines are blurred. 3. crm for people. Customer relationship management software will benefit individual users (not just sales and marketing managers) as social networking, analytics and collaborative technology combine. 4. touch screens out. Forget touch-screen systems—a lack of security and paper trail plus frustration means they’re not going to be touched this year. 5. one-stop software shopping. Consolidation means software giants are more beholden to their largest customers. Thus, the biggest clients will be able to demand cheap software and easier deployment. 6. green it in a different way. Go green this year should mean reducing operational costs to spur new investments in projects, not wanting to become a member of the hottest “Green Club.” For more Nucleus IT predictions, visit www.nucleusresearch.com. Cautious optimism for economic growth in United States Gross domestic product will grow about 2.5 percent and inflation will slow to about 2.6 percent this year, according to predictions from Indiana university’s Kelley School of Business. “We expect the economy will avoid a crisis and continue to muddle through,” said Bill Witte, associate professor and co-director of the Center for Econometric Model research at Iu. Two “basic pathogens” set the model for the nation’s feeble economic performance—the continuing collapse in the housing sector and continuing increases in energy prices, Witte explained. “In the face of these afflictions, it is a little surprising that the economy has held up as well as it has,” he said. “We think that 2008 will be another year in successful survival mode.” Among the highlights of the forecast: • The United States will add about 1.1 million jobs, fewer than in 2007. The national unemployment rate will rise near the beginning of the year and hold fairly steady at around 4.9 percent. • The Federal Reserve will lower the federal funds rate to around 4.25 percent by the end of 2008. The prime rate will drop in step with the federal funds rate. • Mortgage rates for new loans may decline with the overall drop in interest rates. However, upward adjustments to existing adjustable-rate mortgages may cause average mortgage rates to increase. • Energy prices on average will be higher than in 2007 given geopolitical instability, adverse weather and other factors. • Corporate profits will grow by 6 to 8 percent as they face the pressure of rising costs for labor, especially health care and benefits. To read the full outlook in the winter issue of Indiana Business Review, visit www.ibrc.indiana.edu/ibr. Forecast calls for more outsourcing Each year more companies seek to outsource procurement and this year is no exception, the Everest research Institute predicts. “The critical mass and improved supplier capabilities have contributed to the growing acceptance of procurement outsourcing as a viable option to create business impact,” according to Everest’s “2008 Market Predictions: FAO, Global Sourcing, HrO, ITO and PO Markets.” Everest cites that procurement outsourcing suppliers now manage nearly $40 billion for their clients. It notes that given procurement outsourcing’s early stage of market maturity, the standards are evolving, creating high risk for buyers. Everest predicts that human resources outsourcing will top $3.5 billion in 2008. With customers wary of long, costly implementations, and suppliers more desperate to turn a profit, Hr outsourcing will become more standardized and focused on core services such as Hr, payroll, benefits, data administration and contact center. The results will be shorter implementation and faster results. The European Hr outsourcing market will continue to grow at a faster rate than the North American market. Global sourcing of Hr services also will grow as suppliers build global delivery networks and buyers’ increase their comfort level with offshore Hr outsourcing services. To read the full report of outsourcing predictions, visit www.everestresearchinstitute.com. THE LEAdING EdGE 9

The Leading Edge - Winter 2008

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