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With Canadian e-commerce players looking at an "enormous" expansion in online activity over the next five years, those that do not outsource their Internet technology needs are likely to run into a host of technological stumbling blocks, according to a study released Monday by Forrester Research.
Because the country's online economy is set to reach hypergrowth by the end of the year, Forrester warned that e-businesses must revamp their operating models by using external technology (exT).
According to the research firm, exT is information technology (IT) owned and operated by outside parties and made available on a pay-per-use basis.
"As Canada's business community moves beyond tentative forays into e-business and accepts the online environment as critical to its future, old own-it-and-control-it approaches to IT will not be effective," said Forrester analyst Jordan Kendall. "Clear-thinking companies will embrace and implement exT as a fundamental element of their e-business strategies."
Adopting an exT strategy will allow companies to avoid becoming mired in complex technical issues that usually accompany widespread e-business transformation. By using exT to solve those concerns, e-businesses will be able to focus on honing their customer offerings, Forrester said.
Shifting Gears
Forrester said that as e-businesses realize that building and maintaining nonstop IT systems to meet market demand is too cost prohibitive, the need to shift to exT will become obvious.
In addition, the study said that operating an effective e-commerce enterprise requires sophisticated technical skills and few businesses throughout the world have the capacity to integrate new technology at the rate it is created.
As a result, the report predicts that exT will be widely accepted in
the next five years as the
"proven best practice" to support 
a company's infrastructure.
Driving Forces
In fact, Forrester said that the majority of companies will be relying more heavily on exT over the next two years. About 58 percent of those surveyed for the study said their use of exT will increase during that period, but only 16 percent of these firms reported having a blueprint for the changeover.
The top concerns keeping companies from adopting exT are the high costs and the perceived low quality of exT services, said Forrester.
Lean and Mean
Forrester said the technological shift will also bring benefits to IT firms, which will lose mass by the move to exT, but at the same time gain value.
"In a world where operations and technology exist as one, IT executives will be well-positioned to migrate to operations roles where they will oversee and manage the critical relationships between firms and their exT partners," said Kendall.
To compile data and information for its report on "Canada's Adoption of
exT," Forrester surveyed IT professionals at 50 Canadian companies.
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