By Sudhanshu Bhandari and Manish Bahl

India is going through a tough time: Poor policy, delayed reforms, the free fall of the rupee against major currencies, multibillion-dollar scams, and political gridlock are all negatively affecting the country’s growth. However, we anticipate the Indian economy will start picking up — albeit at a slower rate — in 2014, mainly due to good monsoons, improving exports, and huge infrastructure projects that should launch once a new central government is in place.

Forrester’s Asia Pacific (AP) analyst team has just published its 2014 technology predictions report. What top trends will be critical to the Indian market?

  • India’s IT purchases will grow by 8%. Despite broader challenges in the country’s economy, Forrester expects Indian IT purchases to grow by 8% in local currency in 2014. Political instability after the April 2014 national elections is the biggest threat to the economy; India needs bold measures and tough decisions to return to high economic growth, which won’t be possible with a fractured government.
  • CIOs’ IT spending will decline as the business’s clout grows. IT spending in AP is undergoing a critical shift: Business stakeholders are increasingly making IT purchases out of their business budgets, shrinking CIOs’ tech budgets.AP CIOs now control just 51% of enterprise IT procurement decisions, down from 58% in 2012.We expect this to accelerate further as businesses prioritize acquiring systems that can help them achieve growth objectives.
  • Customer experience will surge as a CIO priority. The age of the customer is forcing firms to redefine how they engage with digitally empowered customers. 87% of Indian CIOs say that addressing customers’ rising expectations and improving satisfaction is a high or critical priority.But CIOs must radically shift IT organizations’ focus to target the customer experience, altering governance processes, job descriptions, IT performance metrics, and organizational culture.
  • Customer engagement will drive BI and analytics investments. Two-thirdsof Indian CIOs plan to increase spending on business intelligence and real-time customer and business analytics — tops in AP. Indian companies must understand rapidly changing customer behavior to better win, serve, and retain customers — but CIOs must focus on ROI and link spending to clearly defined business outcomes.
  • Public cloud usage will grow, but managing hybrid approaches will be difficult. Demand for cloud-based services like storage, disaster recovery, and cloud-bursting continues to increase, and two-thirds of Indian CIOs are creating a comprehensive public cloud strategy and implementation plan. Legacy systems, un-virtualized infrastructure, inconsistent download speeds, and latency issues will hinder the widespread migration of enterprise applications to the cloud in India. So will software licensing models, which aren’t designed to support multitenant deployment scenarios, on-premises or in the cloud.

CIOs used to be able to focus narrowly on internally oriented back-end IT — but no longer. The growing power of the customer and business leaders’ increasing involvement in tech investments has changed their reality; CIOs must put customers at the center of their plans. To succeed in 2014, CIOs must stabilize core IT systems and reduce the resources directed toward them to focus on customer-centered systems of engagement.