SAP.info had the chance to talk with Ray Wang, principal analyst and CEO of Constellation Research, at the UK & Ireland SAP User Group Conference in late 2011, where he was a keynote speaker. You can watch the full keynote on YouTube.

SAP.info: In your keynote, you discussed where the enterprise software business and the technology landscape are headed. What is it that IT people need to look for and what’s coming their way?

Ray Wang: I think there are a couple of things. The first is that there are five forces on consumerization of IT: social, mobile, cloud, analytics and UC [unified communications]. Those five forces are going to be with us for the next 10 years and they’re going to permeate every aspect of enterprise software. Where SAP has been successful is in mobile, analytics, and to some extent the cloud. What’s open is really social and what’s on the UC and video front.

That being said, IT budgets today on average are down five percent year over year, and because of that we’re seeing a contraction of IT departments. However, it’s not a contraction in technology spending, because we’re seeing increases of anywhere from 18 to 22 percent in tech spending in elements typically driven by the business side. And so the shift to the business side means that IT is shrinking, but tech spending is increasing. And that has given us the new persona of the CIO, because when we look at how technology is being spent, it’s not just by the IT department. So what we see is, these four personas of a CIO, from a chief infrastructure officer to a chief integration officer to a chief intelligence officer to a chief innovation officer.

One CIO could possibly play all four roles, but it’s very hard to do in a large company. And so, in the enterprise you tend to see the chief integration officer and the chief infrastructure officer play a role that’s in traditional IT while the chief intelligence officer and the chief innovation officer play a role that could and most likely will belong to business.

The danger with the consumerization of IT is that we move too far away from each other. And if business is very successful in adopting these new technologies, but not taking into account the need to harmonize or to standardize across the enterprise, in two to three years the business will fall apart. If IT has succeeded in standardizing everything, in two to three years there’ll be no business. You need that tension between innovation, standardization, and harmonization.

SAP.info:  So you’re not saying let’s push toward the future and not look left or right? You’re saying, think about what you have and how you move forward?

Ray Wang: Correct. IT and business needs to work more closely than ever to be successful. You may have one work stream that is allowing business to take off, but IT should at least help with some architecture, planning, to set some guidelines and to say, here is what we’ll need in three to five years. Or, here is what you’ll need in 24 months. A great example is in mobility. Right now you may use a lot of point mobile solutions to get something done, but long-term there may be a bigger strategy that requires an enterprise mobility strategy. So in the short run we may have something like 100 different mobile apps that are running on different platforms, but in the long run we may standardize the ones that are more common. In analytics the same thing is happening. You may start with all these SaaS-based or cloud-based analytics, but in the long run you may want to have one analytical frame.