Happy New Year! I’d like to say a special Thank You to JD Kathuria and my friends at WashingtonExec for publishing my look into the crystal ball for 2012. Here is the Post:
2012 is here, and with it comes big changes for the Federal IT industry. WashingtonExec gave local executives the opportunity to share their thoughts on where they see the government contracting industry headed.
Tien Wong, Chairman and CEO of Lore Systems and Opus8, gave WashingtonExec six factors that he believes will affect the 2012 Washington, D.C. entrepreneur and government contracting communities.
1. IT SPENDING and THE ECONOMY – IT spending will increase both in commercial and government sectors, particularly in infrastructure, cloud, and mobility. We have seen an uptick in business at Lore in the last quarter particularly from our commercial clients. In conversations with many clients, I believe that overall confidence in the economy is improving a lot!
2. PRESIDENTIAL ELECTION – Obama will be re-elected. If the economy is improving, that favors Obama.
3. STARTUPS – Startups in the DC region will continue to blossom. The ecosystem is as active and sanguine as it has been in the past 10 years. You are seeing groups like Startup America, Startup Maryland, Startup Virginia, FounderCorps, and established and new incubators take a keen interest in our region. Angels are investing, and groups like Virginia’s CIT and Maryland’s DBED will be investing new allocations of seed money.
4. CLOUD COMPUTING – Cloud adoption in the federal government will accelerate both internally via virtual private clouds, and via commercial providers with new FedRAMP guidelines and the award of commercial Infrastructure as a Service (IaaS) contracts (GSA’s IaaS and the Army’s APC2, for example). The economic and performance benefits are far too great for cloud not to be aggressively adopted well into the future.
5. DATACENTER CONSOLIDATION – Regarding the federal government’s datacenter consolidation efforts, the government will successfully close many datacenters. However, I doubt they will hit their goals in 2012 because many individual application owners and datacenter operators are not as cooperative in providing information and complying. Further, there’s a cost to consolidating and there are limited funds to achieve this, so you’ll likely see a lot of funding come out of O&M budgets.
6. SMALL BUSINESS – Because of drastically reduced budgets, the government will rely on small business and entrepreneurs for creative ideas to cut costs, drive productivity, and improve performance. The DoD customer has been very open to the commercial best practices Lore is bringing to the table re: datacenter consolidation and application migration. In addition, small business is more nimble and unencumbered by the fixed costs of the “Bigs,” so we can offer creative pricing structures, and ways for the government to buy from us. We will see more firm fixed price offers, and shared-risk pricing, which inevitably will save the taxpayers money.
Please let me know what you think about these predictions. Thanks for reading, and please subscribe to my Blog! All the best for an awesome 2012!
Featured image courtesy of Mike Licht, notionscapital.com, licensed via creative commons.