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Could the recession be good for enterprise software?

Could the recession be good for enterprise software?

Once the recession ends, the IT industry will have changed in multiple ways, industry observers say.

Meanwhile, as corporate budgets tightened in recent months so did CIOs' influence on IT strategy, according to Rebecca Wettemann, vice president, research, at Nucleus Research.

Chief financial officers are going to be pressing CIOs harder for answers to questions like "what am I getting for it" and "why am I paying for it," as well as taking a more active role in choosing technology, she said.

Wang agreed. "SaaS is one of those end-games, those end-runs around IT," he said. "It's the first sign of the business guys calling the shots. You can swipe it on a credit card."

IT department budgets will drop in coming years, but overall, technology spending will be the same or even increase because business units will "have more skin in the game," Wang added.

As for now, IT executives like John Glowacki are trying to maintain a pragmatic and positive attitude.

"You have to operate from the premise of, 'We will come out of this recession.' You can't just cut everything," said Glowacki, CTO of Computer Sciences Corporation (CSC), the giant systems integrator. "Given that premise, what's the future? What do we need to be planning?"

The recently passed U.S. economic stimulus bill, which includes money for expanding broadband infrastructure, is helping lay the groundwork for the future expansion of cloud computing and SaaS, he noted: "If you don't have the pipes it's just not going to work as well."

The recession is also helping companies like the large software vendor SAS Institute tighten up its IT operations.

SAS has historically had a number of regional systems and in recent years has been trying to work in a more centralized manner, according to CIO Suzanne Gordon.

"In this kind of economy, everybody's willing to do that," she said. "It's a great time to get people to cooperate and collaborate. ... When the money's flowing, everybody wants to do it their way."

Past recessions saw a similar dynamic play out at SAS, with IT operations "getting better with each iteration," she said.

The wave of IT-related layoffs in recent months could also spark a broader wave of innovation, said Redmonk's Coté.

Interesting technologies have been dreamed up by people who lost their tech jobs, with one example being the popular blogging platform Movable Type, he said. "That might be one of the bright sides of this."

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Tags enterprise softwareglobal recession

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