Albert Einstein once said, “Imagination is more important than knowledge.” Today, that might be paraphrased as, “Innovation is more important than invention.” As the head of a major research organization, I am surrounded by incredibly talented, creative people with an impressive track record of invention in all aspects of IT. Yet, the focus of our researchers has expanded beyond the invention of new hardware and software to include closer collaboration with customers in the application of that technology, often through services engagements.

The things that customers value are changing. The emphasis is shifting from “the next big thing” in technology to creative application of technology to change the way things are done in business, science, government and society at large.

For example, one IT trend we see in the coming decades is in underlying semiconductor and storage devices, where traditional materials, design and manufacturing will gradually give way to nanotechnologies like molecular self-assembly, spintronics and carbon nanotubes.

Yet, improved chip and storage hardware alone won’t necessarily help customers change the way they do business. But what they can do is hasten a new generation in high-performance computing, autonomic computing and virtualization and grid technologies that will allow customers to manage their processing resources, and their business, in a whole new way. To get there, however, will require that we couple these underlying technologies more closely with software and system design in a much more holistic way. This will be the new path to system optimization and to changing the definition of what constitutes a “system.”

At the other end of the spectrum, these underlying chip and storage device improvements will also lead to the introduction of computer intelligence into more everyday products. It will result in tremendous increases in the amount of data available for analysis. If put to use properly, this data can improve existing business operations and make possible whole new business models.

The desire to exchange all this information between often disparate systems, within a given enterprise and between enterprises, will drive broader development of standards. Yet, the momentum in open source code and open standards will also change the dynamics of how technology like software is developed, structured and sold. This will force the industry to examine the fundamental legal and business issues over control of intellectual property in general.

What’s different in the scenarios I just described for systems, pervasive devices and data management is that they go beyond simple technology trends. Yes, underlying technologies will advance, intelligent systems will proliferate and broadband Internet and open standards will allow data to flow more seamlessly. All of this will lower the cost of transactions and interactions and extend the virtual enterprise.

Yet, while all this technology for collecting, transmitting and storing information is great, the larger issue customers are grappling with is what to do with it all? They recognize that advances in technology will open new doors, but the question is where those doors will lead? This is where the opportunity for innovation comes in — not just invention of the next widget, but applying technology and expertise to do something new and better.

The ultimate measure of a business’s success will be its ability to be more responsive, flexible and adaptable to changing customer needs and the overall environment in which it plays. This is what has been termed “on demand” and it is the end state to which competitive businesses are evolving.

That end state will be reached through the creative use of an evolving IT infrastructure to lower costs or to provide innovative products or services. This is where customers will see real value in the use of IT to fundamentally change their business. It is the merger of two previously distinct spheres of innovation, in business model design and in the most advanced information technologies and research. This will be the most important trend of them all in the coming years. We’re moving from the information era to the innovation era.

This trend will force the IT industry to evolve beyond traditional technologies and skills. It will require that participants be
equipped with a better understanding of how businesses operate, as well as the trends in specific businesses and industries themselves.

It is clear that this will require better insights on where a particular business or industry is heading. This is one of the more important, yet intangible, trends we will face because there is no established model. But what is clear is that business and industry trends will evolve in a much more complementary way with IT. Close collaboration between those at the concept phase of IT — Research — with those at the user end of IT — clients — will become more the norm to ensure that linkage.

It will be essential to look at the two together, not as isolated efforts. Indeed, the future of IT will be determined as much by businesses as it will be by researchers, which begs the question: where will the skills come from? Who will be the people to do this? This brings me to my last prediction on IT-related trends in the coming decades, this time centering on skills development.

Our current technical schools turn out great computer scientists. Our business schools graduate brilliant MBAs. But, with a few exceptions at the fringes, little is happening that fuses the two. Given my premise that the overall trend will be the merging of technology and business, so, too, will we see a trend in merging these two disciplines at the academic level. The industry is waking up to the fact that the future will value innovation, that innovation demands a new combination of skills and that our current system is not set up to deliver them.

Since much of this innovation in the analysis of business components, and the application of IT to improve business processes, will likely take place in a services setting, we’ve dubbed this new combined discipline “services science.” More than just combining technical and business courses, this will be the path to the new set of higher-order skills that will carry value for clients and, therefore, carry the promise of jobs and economic growth.

So, beyond IT advances alone, my predictions for the coming decades are this: Businesses of the future will rely on innovation to survive. IT suppliers of today will evolve into innovation suppliers of tomorrow through more of a services scenario. This will involve collaboration with customers, partners and suppliers, as well as academia, government and other parties in a cohesive ecosystem. And all of this will demand new skills, spawning the creation of a new discipline to ensure jobs and competitiveness.

If we’re right, we may look back at this period as a turning point in our understanding of what IT is really all about.