IT budgets to grow by 2.5 percent in 2005: Gartner

IT budgets to grow by 2.5 percent in 2005: Gartner

Summary: Chief information officers (CIOs) are expecting IT budgets to increase by 2.5 percent in 2005 and will be shifting their focus on supporting business growth and results, according to a survey by Gartner Executive Programs (EXP).

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TOPICS: CXO, IT Priorities
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Chief information officers (CIOs) are expecting IT budgets to increase by 2.5 percent in 2005 and will be shifting their focus on supporting business growth and results, according to a survey by Gartner Executive Programs (EXP).

Over the past few years, CIOs have had to focus on internal efficiency and cost control, while preparing their organisations for an economic upswing. According to the survey, CIOs also voiced concerns about their relationship with the CEO and whether or not they have the right people to meet current and future business needs.

Gartner EXP surveyed more than 1,300 CIOs representing more than AU$57 billion in IT spending and covering more than 30 countries.

"Business expectations are now forcing CIOs to transform the IS organisation and 2005 is the year where CIOs must deliver more value and become a contributor rather than a commodity," said Andrew Rowsell-Jones, VP and research director for Gartner EXP.

Gartner showed security enhancement tools and business process improvement as the number one priorities in its top 10 business and technologies priorities for 2005.

According to the survey, CIOs are expecting to face three critical challenges for 2005:

(1) Two-thirds of CIOs surveyed see themselves as "at risk" based on the CEO's view of IT and its performance. To address this, Gartner said the CIOs need to raise and stabilise the quality of IT services and provide measures that clearly demonstrate the contribution of those services and their ability to deliver growth.

(2) The survey also showed that only 39 percent of CIOs believe they have the right people to meet current and future business needs. Only 20 percent of CIOs who put business process improvement in the top 5 priorities for 2005 believe the IS oganisation has the necessary skills to implement this. Gartner said the skills gap must be addressed before enterprises can leverage this opportunity. Around 51 percent of CIOs also reported concerns around an aging workforce as a result of difficulty in attracting new people with the right skills to meet the new requirements.

(3) Gartner said that the changing role of IT -- as it moves towards greater involvement with business process and business intelligence-- will transform IT's role in new ways. This will force changes in IT governance, business relationships and accountabilities, and the overall conecpt of an IT organisation.

Topics: CXO, IT Priorities

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