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Gartner: Sun will shine after 2009 doom and gloom
- — 09 February, 2009 08:46
The sun will shine again after this year's doom and gloom, according to Gartner's 2009 CIO Agenda survey.
The survey, which canvassed 1500 CIOs worldwide from September to December, 2008, found the average weighted IT budget increase year over year for 2009 will be just 0.2 per cent, a decline from 3.3 per cent in 2008.
“It was pretty clear by October, November, December, just how bad 2009 might actually turn out to be,” Gartner vice president and research director, Andy Rowsell-Jones, said.
“If I wanted to represent 2009 pictorially it would look like this: A dark foreboding sky, there’s a road curving off between some very jagged looking rocks and we’re not altogether sure what is coming around the corner. This is in a sense how 2009 looks like it’s going to be for all of us, whether we’re government agencies or private sector organisations.”
The average company size of respondents was 400, with an average IT budget of $90 million. Rowsell-Jones said the survey offered several key insights into what 2009 will likely bring, beginning with a major drive to reduce IT costs.
“For the first time ever in our global survey, reducing IT costs itself has become part of the priority package for CIOs," he said.
“In previous cycles IT has been seen as part of the solution, this time it seems IT is seen as part of the cost problem – that is a new and disturbing development I have not seen in ten years of doing this survey.”
Following the focus on reducing costs, the most pressing issue facing private sector organisations in the current climate is not competitors offering a better price or product, but rather a decline in consumption.
“So how do you re-stimulate or sell to a customer that is reluctant? You offer them more, better service, all sorts of incentives and that often means from an IT perspective you have to make changes, but you don’t have any money to do it with,” Rowsell-Jones said.
“So if we haven’t seen it already, we’ll certainly see shortly a flood of requirements from the sales force and marketing groups to try and stimulate demand against a very flat economy.”
Cash flow analysis and forecasting will also be a key note CIOs will need to get in tune with, as will flexibility in terms of reducing costs and getting a better return on staff. “We’re also looking at trying to inject flexibility into our asset base; hardware or software, bits of technology implemented that aren’t fully used. This year we need to be flexible enough to bend our business processes to use those because we don’t have any cash and we’re trying to drive costs down.”
Finally, global capital constraints will be strongly felt in 2009, as companies simply cannot afford to fund projects. Rowsell-Jones added that it may not be all doom and gloom because while capital budgets are constrained the survey indicates more of it may actually be spent.