Gartner predicts tight budgets for 2009

IT spending in 2009 will change little from 2008, according to a worldwide survey of 1,500 CIOs by Gartner Executive Programs (EXP).

IT spending in 2009 will change little from 2008, according to a worldwide survey of 1,500 CIOs by Gartner Executive Programs (EXP).

Despite expectations of sharp IT budget cuts as the economic downturn continues, CIOs indicate there will be an average global increase of 0.16%.

European CIOs predict growth of 0.48%, but UK CIOs expect an average decrease of around 2.2%.

In general, the changes are very slight, said Gartnet analyst Dave Aron. This is because IT is fairly lean already with little growth in the past four years. It is also seen as a business enabler.

"Many organisations are looking to IT to help get efficiency and effectiveness in the rest of the business rather than drive out IT cost," he said.

CIOs will have the same resources as they had in 2008 to address a new set of challenges, which means working smarter to raise efficiency and lower costs.

Effective enterprises understand working smarter and they are using IT to extend their market leading position, said Mark McDonald, group vice-president at Gartner EXP.

"Less effective enterprises are simply not investing in IT beyond what is needed to support day-to-day operations for short-term survival rather than strategic gain," he said.

The survey shows that business expectations for IT focus on improving current operations and performance.

Improving business processes is in top position, which is unchanged from the past three years, followed by reducing enterprise costs, up from fifth position in 2008, and improving workforce effectiveness, up from sixth position.

The hot technologies for 2009 are the technologies that are already in-house, according to the survey. CIOs are concentrating on getting the most out of existing technologies such as business intelligence and meeting increased needs for communications and storage.

Organisations are investing in new technologies such a Web 2.0, but the scale of those investments is significantly less than the money spent on the existing technology base, said the report.

In the face of continued economic volatility and uncertainty, CIOs will have to be decisive in setting priorities that increase business effectiveness.

Priorities for 2009 should focus on improving business processes, using business intelligence to raise visibility within the organisation and enhancing workforce effectiveness.

"CIOs need to be very clear about what is strategic and what is not and act on it rather than muddling along doing the same portfolio of projects," said Aron.

Organisations should use the opportunity to remove all the dead wood such as "zombie projects" that never end and even to remove non-performing people.

"CIOs should refocus on the business strategy, get really clear on how the business will win and how IT will help, and then aggressively prioritise the IT portfolio based on that," said Aron

Enterprises face a challenging economic environment in 2009 and expect IT to contribute by reducing costs to the business.

To do this, CIOs need to be resourceful in building an effective enterprise that can meet current and future challenges, the report said.

For many CIOs this will mean restructuring IT to raise its productivity and modernising the technical infrastructure to meet business demands for lower energy consumption, improved performance and greater storage capacity.

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