Aust and Kiwi CIOs bank on higher budgets

Summary:Australian and New Zealand chief information officers (CIOs) expect IT budgets to increase by 3.6 percent in 2005, higher than last year's 1.

Australian and New Zealand chief information officers (CIOs) expect IT budgets to increase by 3.6 percent in 2005, higher than last year's 1.2 percent and well above the 2005 global average of 2.5 percent, according to Gartner.

The expectations -- detailed in Gartner Executive Programs' global CIO survey -- contrast with last year's experience, when the worldwide budget increase of 1.4 percent outstripped the Australia and New Zealand rate of 1.2 percent.

Australia and New Zealand CIOs said their focus for the year would be on "supporting business growth and delivering results". Like CIOs overseas, ANZ CIOs also voiced concerns about their relationship with the CEO and whether they have the right people to meet current and future business needs.

Vice-president and research director for Gartner EXP, Andrew Rowsell-Jones, said in Australia and New Zealand, CIOs are as focused as their overseas counterparts on improving the efficiency of their enterprise "but are also more concerned about enterprise risk" mainly because of Australia's fluid governance environment.

"Governance has always been a much more important issue here. In America or Europe there are various governance compliance requirements -- such as Sarbanes-Oxley--which have provided the rule book to play by. But if you're a CIO in Australia/New Zealand, the rules keep changing, keeping governance a top of mind issue," he said.

Rowsell-Jones said Gartner was beginning to see a "return to confidence" in IT investments compared to last year when IT was seen as part of the problem instead of part of the solution.

"I think we are seeing the trend now. It is a return to confidence as IT is beginning to be seen as part of the solution again. Last year there was a holding pattern for IT investment because the industry was seen then as part of the problem. We were a part of the cost problem instead of the solution," Rowsell-Jones.

He added that although data security is still important for CIOs, it has become like an "old story" that just needs to be dealt with.

Missing in the Australian top 10 business priorities is the need for revenue growth which was number 9 on the list last year. Overseas counterparts have rated revenue as sixth priority, yet it doesn't rank anywhere in the top 10 priorities in Australia.

"One explanation for this is that contributing to revenue growth still isn't seen to be the role of the CIO here. Maybe CIOs are still seen as technologists, rather than business leaders," said Rowsell-Jones.

While overseas CIOs carry the business growth theme across to their top 10 CIO strategic management priorities -- delivering projects that enable business growth is rated number one -- Australia/New Zealand CIOs rated their top strategic priorities as consolidating the IT organisation and operations, and improving IT governance.

Rowsell-Jones said it is not a surprise that ANZ CIOs rate the top priority differently.

"For public sector CIOs here in Australia/New Zealand, the move to shared services is a well reported hot topic. For private sector CIOs, there is pressure to improve operational efficiency of the IT organisation, which is causing them to consider centralisation. But there is a second reason. For some Australia/New Zealand private sector CIOs, consolidation can also mean their role is integrated into a larger operation overseas," he said.

He added that no matter what the cause is, "centralisation places a greater emphasis on the need for good leadership, which explains its high ranking among Australia/New Zealand CIOs in the survey. For CIOs to thrive they must be leaders".

Like overseas CIOs, ANZ CIOs rank business intelligence and security enhancement tools highly. Infrastructure integration tools are a higher priority as well compared to last year.

Rowsell-Jones believes that although infrastructure integration might be unglamorous, the fact that it ranks highly in the country "shows a typical Australian/New Zealand dogged determination to keep working until the job is done".

Around 65 (5 percent) of the total 1,300 CIOs surveyed were from ANZ.

Topics: CXO, IT Priorities

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