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SIM 2009 study: Boosting productivity and cutting costs top IT concerns

Initial results for the SIM 2009 IT Trends Survey reveal that business productivity and cost reduction are the top concerns for IT executives.
Written by Chris Jablonski, Inactive

Initial results for the SIM 2009 IT Trends Survey reveal that business productivity and cost reduction are the top concerns for IT executives.

IT and business alignment, the number-one concern in 2008, fell to number-two on the survey, which is commissioned annually by the Society for Information Management and provides important benchmark data in areas including spending, salaries, job scope of IT professionals, and technical/business trends.

The results indicate that information technology executives are not slashing jobs as part of their cost-cutting efforts in the same way way as they did in previous economic downturns. In the current recession, they're instead making the most of their budgets. Dr. Jerry Luftman, a professor at Stevens Institute of Technology, said that the the downturn has caused a significant shift in priorities.

"While IT organizations have slashed spending on infrastructure, they don't seem to be laying off IT people; the IT turnover rate is at 6.9 percent. In fact, the most successful IT organizations are not being asked to cut their own expenses, but to help the overall business reduce their costs.

"The bad news is that they're not hiring like they have in recent years. Instead, they are filling gaps by outsourcing domestically because this is faster than going overseas, but that will change next years," said Luftman.

Below is a list with the top 10 concerns in SIM’s annual survey together:

  1. Business productivity and cost reduction
  2. IT and business alignment
  3. Business agility and speed to market
  4. Business process re-engineering
  5. IT cost reduction
  6. IT reliability and efficiency
  7. IT strategic planning
  8. Revenue generating IT innovations
  9. Security and privacy
  10. CIO leadership role

Respondents indicated the number-one application/technology of importance is Business Intelligence (BI).

"This is a very complex technology, and IT organizations have been struggling with it for many years," Luftman noted. "It requires your data repositories to be in good shape, and that is hard to do."

Following BI was server virtualization, enterprise resource planning (ERP) systems, customer/corporate portals, enterprise application integration/management (EAI/EAM), and continuity planning/disaster recovery.

According to Luftman, virtualization is an infrastructure investment with an important message behind it: "Companies could make other infrastructure improvements, such as software as service, cloud computing, and grid computing, but they're off the list. Virtualization is on the list because its costs are relatively low and it is relatively quick to deploy."

As for IT budgets, the study revealed that over half of those surveyed, 52 percent, said their budgets fell, and 23 percent said they remained flat. One in four companies increased spending, though this was down from 46 percent in 2008 and 61 percent in 2007. Next year, respondents said that their budgets will stabilize, with 45 percent of IT managers expect budgets to remain flat, 28 percent see them falling, and 27 percent see them rising in the year ahead.

These preliminary top line results are only a small part of the comprehensive SIM study. In-depth results for this year’s survey will be presented at SIMposium 09 next month in Seattle, Washington.

Sources: Society for Information Management, Steven's Institute of Technology

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