How smart computing is fueling the next wave of IT growth

Editor's Note: Christopher Mines moderates the "Managing Energy & Emissions" panel tomorrow at VERGE DC.

In 2009, my research team here at Forrester published a report on what we called "smart computing," a new generation of hardware, software, and networks that connects physical infrastructure with analytic computing systems.

Next month we will publish an update to that research, outlining why we continue to think that smart is the next wave of IT industry growth, likely to outstrip cloud and mobile computing in its eventual impact.

We believe that smart computing -- sensors, M2M networks, and analytics, along with collaboration tools -- will be as transformative of business in the coming decade as the Internet and Web browsers were during the 1990s.

Why is smart still the next big thing? Consider:

  • Improving transactional processes is yesterday's story. The back-office challenges of preparing financial statements, fulfilling customer orders, or tracking inventory are well addressed by enterprise and personal productivity software. These traditional workloads are migrating to cloud computing resources in some cases, but are not creating incremental technology investments nor opportunities to transform how a business operates.
  • Optimizing assets is the next important challenge. Especially in service-based industries, favorable economics result from building an asset base and then selling access to those assets in the form of services. Managing and optimizing the use of those assets -- physical, human, financial, and intangible -- is the source of revenue growth and improved margins. Smart computing systems provide the awareness, analytics, and actions required to improve the utilization of a firm's assets. And in most cases, these systems represent incremental investments in computing resource, with the payback coming in the form of more efficient, more highly utilized, and therefore more profitable assets.
  • Smart flexes to meet industry-specific challenges. Each industry has a different mix of assets with different optimization opportunities. In high-tech, development and channel resources must be marshaled in the face of accelerating development cycles, long supply chains, and unpredictable consumer tastes. In finance, mountains of data must be sifted to find the best investment opportunities, while managing market and compliance risk and keeping employees productive. Finding the right mix of online and brick-and-mortar, the right product portfolio, and lean inventories are paramount for retail execs. The right portfolio of smart computing solutions will vary widely across these and other industries (see chart below).

Click chart for enlarged image.

Next Page: A look at adoption rates for smart computing technology.