GFC Dampens CIO IT Budget Optimism: Gartner

The global financial crisis is beginning to negatively impact the optimism of CIOs across Australia and New Zealand, according to new research from Gartner.

In its CIO Agenda survey, carried out in the fourth quarter of 2008 and measuring the budget expectations of 1526 CIOs worldwide — including 85 from ANZ — the research firm found that 59 percent of ANZ CIOs expect their IT budgets to grow in 2009, with an average increase of 1.67 percent.

Twenty-two percent expect to see their budgets to decrease and 19 percent expected it to remain flat, Gartner found. At the same time, results from CIOs in the rest of the world showed IT spending was expected to remain essentially flat with an increase of just 0.16 percent during 2009.

Andy Rowsell-Jones, vice president and research director in Gartner’s CIO research group, said the fourth quarter 2008 budget expectations for 2009 were optimistic, however, ANZ CIOs did appear to be responding more positively to the economic crisis than some of their peers in other regions.

“The survey results reflect the fact that in Australia and New Zealand, leading organisations recognise the seriousness of economic conditions, but they are not paralysed by them,” he said.

“These CIOs have confidence in their ability to use IT to achieve results in an uncertain economy. Rather than simply reacting by cutting IT costs, IT can be used to reduce business costs.”

The Agenda survey, which also looked at the top 10 business and technology priorities in 2009, found that business and technology priorities of CIOs in Australia and New Zealand were largely aligned with their global counterparts.

Of the business priorities, Business process improvement, Cutting enterprise costs, and Improving enterprise workforce effectiveness were named by both local and global CIOs as their respective top three priorities.

However, targeting customers and markets more effectively was ranked only eight globally and fourth by local CIOs. Increasing the use of information and analytics was mutually ranked fifth.

Of the technology priorities, Business intelligence applications and Enterprise applications (ERP, CRM and others) ranked mutually first and second. Legacy application modernisation, upgrade or enhancement was ranked third by local CIOs and fourth globally.

Servers and storage technologies (including virtualization) was ranked fourth locally and third globally. Networking, voice and data (including VoIP) was ranked fifth locally and sixth globally.

“In 2009, executives face challenging global economic conditions that have not existed for more than 50 years,” Rowswell-Jones said. “The survey results show that more than ever, 2009 is the year for CIOs to be decisive and resourceful in order to succeed.”