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Self-Fulfilling Prophecies?

Self-Fulfilling Prophecies?

It's time analyst forecasts were met with more scepticism.

Late last year something unusual happened in the IT industry. For the first time I encountered a journalist who queried a projection from Gartner. This was a bit like someone questioning the merit of motherhood or apple pie. For as long as I can remember, everyone in the ICT industry has regarded Gartner as the ultimate font of wisdom. Among the many CIOs I meet the unwritten law seems to be: if Gartner said it then it must be true. Yet here was a journalist asking my views on Gartner's forecast that local IT budgets were likely to rise by around 15 percent over 2004. My view of this at the time was that it was a "wildly optimistic" prediction.

The reporter then asked my thoughts on a number of technologies for which Gartner was heralding big futures. Top of their list was RFID (radio-frequency identification). I'm not ashamed to admit that I had to ask the journalist to explain to me just what RFID tags were. Once upon a time I would have been embarrassed to admit that I was ignorant of some new industry development. Now that I talk "one-on-one" with around a 100 local CIOs each year, I figure that if they don't mention a new technology to me, then it probably isn't worth knowing about yet. And not one of the CIOs I spoke to last year raised the subject of RFID in my discussions with them. Clearly, this was not something dominating their immediate agendas.

Nevertheless, to be fair to Gartner, the latest Forecast for Management survey I conducted earlier this year for IDC found CIOs predicting RFID tags as the technology they were most likely to implement over the next two years. However, I will be amazed if these projections come true. For me RFID tags are like many other technologies I've encountered in my twenty years in IT. They might sound good in theory, but until CIOs have done project evaluations and prepared business cases for their boards all they are is vapourware.

My scepticism about RFID centres around the fact that it will require major infrastructure investments before the technology's functionality can be harnessed. RFID tags allow for the reading and writing of information remotely by specialist devices. Clearly, they have potential for a number of applications in the supply chain and in retail. In many regards they can be seen as an enhanced successor to barcodes. However, in my view, this also represents their biggest hurdle.

Barcodes and barcode readers work. No CIO has ever spoken to me about his or her frustration with them. The non-profit organization EAN Australia helps define common standards for barcodes. This means that everyone has a set of rules and definitions to follow in deploying and reading them, which in turn helps to maintain internationally-defined guidelines for using the technology. RFID will need to usurp this entire infrastructure if it's going to make an impact. In the current business climate, where every IT investment is under the microscope, I just cannot see this happening in the short term.

I do think it ironic, however, that Gartner - the very people who developed the concept of the hype cycle - should now be trumpeting RFID. They must know that their endorsement will encourage many IS executives to investigate its capabilities. It's almost as if they expect RFID to become a self-fulfilling prophecy.

I think a bit more rigorous questioning of such forecasts would do the IT industry a lot of good. The industry has cried wolf so many times that it's created a generation of executive Doubting Thomases. A bit of realism and scepticism in the forecasts of all analysts will be required before we can restore executives' faith in the potential of ICT to enhance the business.

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