Published on the 30/11/2009 | Written by Newsdesk
IDC survey finds that to survive the global financial crisis, firms have trimmed admin, operations and ICT budgets rather than making IT staff redundant…
Research firm IDC’s latest annual survey of Australian and New Zealand CIOs indicates that 3 out of 4 companies faced the economic crisis without cutting IT budget or IT staff.
The survey found cost savings were achieved in key organisational areas such as administration and operations (45%) and ICT (11%).
IDC’s 2009 Forecast for Management Survey also showed that IT spending growth remained at steady levels.
“In 2008 CIOs already faced a difficult situation dealing with an onslaught of disruptive technologies transforming IT such as SOA, SaaS, convergence and others,” says IDC senior market analyst Melissa Martin.
“However, in 2009 this transformation was taking place in an economic pressure cooker. While we used to talk about using IT as a tool for business transformation, it was generally considered voluntary. However, as IDC’s 2009 results reveal, thanks to the global economic crisis, there is business transformation whether CIOs like it or not,” Martin says.
“Operation budgets of ANZ CIOs are experiencing a shift,” says IDC associate market analyst Adam Lee, who co-authored the report.
“Some confirmations: hardware and software refreshes are stretched, and a close watch placed on maintenance fees as they become significantly lower. Some contrasts:
Outsourcing is falling slightly, network spend is up and planning for internal and external staffing increased for ANZ organisations,” Lee says.
“Moving forward, this disruption and change equals opportunity for the CIO – an opportunity to review IT systems; staff setup and knowledge; products and services offered; to look at vertical market opportunities and to capitalise on competitive strengths.”
Other highlights from IDC’s Forecast for Management Survey series of reports include:
• The top three CIO priorities in 2009 are: reducing costs (27.6%), recruiting and retaining staff (10.3%) and meeting users’ expectations (10.2%).
• The importance of IT persisted even during the economic crisis: 58.2% of survey respondents in 2009 believed that IT contributed to the operational capacity of their business. A further 33.8% viewed IT as a source of competitive advantage.
• The top three areas of IT Investment over next 12 months will be: systems infrastructure (security, storage, network, middleware etc) – 18.6%, back office: eg: Enterprise Resource Management (ERP) – 16.1% and front office: eg: Customer Relationship Management (CRM) – 14.7%.
• CIO reporting lines are changing: Due to the greater focus on reducing costs and doing more with less, CIOs are now reporting to CEOs (50.1%) COOs (17.5%) and (CFOs 14.7%). This contrasts greatly to last year’s results where 78% were reporting to CEOs and only 5% to CFOs – providing yet another way to show how companies are responding to the current economic crisis and the increasing importance of controlling and monitoring operations and costs.
