After a tight year, technology industry is looking forward to putting 2008 behind it. In 2009, however, most CIOs’ top priority will not be supporting the business’s growth goals. The CIO’s will be puzzled as to how organize IT more efficiently and dealing with new compliance demands.

Recently Wall Street & Technology organized a roundtable with experts to find out what challenges the CIO’s face in 2009. The experts:

• Rob Hegarty, Managing Director and Practice Leader, Securities & Investments and Insurance, TowerGroup
• Julio Gomez, Founder, Gomez Markets
• Mayiz Habbal, Managing Director, Securities & Investments Group, Celent, an Oliver Wyman Co.
• Robert Iati, Partner, Global Head of Consulting, TABB Group

The question was: how has the role of CIO’s change due to global changes in market place?

Rob: As we look out into 2009, it is important to take a longer-term view than the markets have taken in the past few weeks. The markets will come back, and for 2009 the biggest thing will be: Don’t take the strategic hat off permanently. It is going to be important for the CIOs and the industry to take a look at what is going to happen one to two years out. These times are the best times to position for future growth. If you can make your way through these times, and make decisions about how the world is going to look in two to three years, you are going to be much better off than the firms that have stuck their head in the sand and have acted purely tactically.

Julio: There is a major challenge for CIOs because they know what’s coming in the next year or two. They know they are going to be called upon to do much, much more with potentially much, much less. So potentially driving the efficiency in the IT organization is no small feat. They are going to have to figure out ways that technology can help.

Mayiz: Going into 2009, from a technology perspective I don’t think we are going to see a sea of change. It is going to be a disappointing year for technology firms in terms of IT spending. You are not going to see any major initiatives taken [by firms]. Some of the technology firms that have been capitalizing on the large upswings of IT spending will probably disappear. We may see a lot of acquisitions happening in this market, particularly in risk management and portfolio management areas. These areas have been fragmented for the past 10 years and there are many companies in this domain, and the downturn in the market is going to create opportunities for acquisitions and consolidation of customer bases.

Robert, TABB Group: The biggest issue is what the investment banking infrastructure will look like in a year or two or three. Clearly it has been discussed over the past two or three months. The situation you have now, with fewer large investment banks as they are now organized as commercial banks — where is the liquidity void going to be? Where is the capital commitment going to be that the [investment banks] had, where is that going to be filled? We see the more independent investment bank of the 1980s taking a larger role. We don’t see too many of those types of firms right now, but they will definitely be forming, and they will have to fill need in the market. And they will bring trust back into the market because the way they did business back then was more on a trust basis and there was more skin in the game for the ownership of these shops; we will see in three or four years a structure that we saw in the ’70s and ’80s. We think it will happen, and when it does, what does that mean for the medium term of the market?

One more question from Wall Street and Technology: Can the market wait for this to happen?

Robert: I don’t think it has a choice. You see the significant layoffs at these banks, and it will take that long for the markets to settle and understand what it is going to be in a couple of years. The market never waits, and the existing players will continue to move forward aggressively and probably more aggressively than they should at times. But I think we are always looking with a short-term focus but trying to understand what a three-year time frame would look like. No one in this industry is brave enough to look beyond three or four years. It is nice to say what the market will look like in 10 years, but in reality it is impossible to understand.

Prepared by Mirasoft Group – http://www.mirasoft-group.com

Based on materials: www.wallstreetandtech.com