CIO survey predicts another tough year for vendors

Von Samantha Perry

The results of the latest Gartner Inc. CIO Priorities research are, in many ways, heartening for an industry that has been in something of a slump of late. Overall, budgets are up by 2.5 percent and the CIOs interviewed (some 1,300) represent some US$57 billion in IT spend. They are also, according to the survey, planning to spend the money.

Bad news, for the vendors at least, is that a budget increase of 2.5 percent is not all that much, and is, says Marcus Blosch, group vice-president and research director for Gartner EXP, not likely to be spent on new investments.

CIOs are having to prove that they can do something constructive with budget before it is allocated to them, notes Blosch, who says that CIOs are focusing on smaller projects that will give quick wins, so as to get the ball rolling and prove that they can deliver.

CIO?s top three priorities this year are, according to the research, business processes, security breaches and disruptions, and enterprise-wide operational costs, Blosch says. ?CIOs are looking to business processes and business intelligence to improve business growth. The pressure is on to prove they can deliver, and business processes and BI are two areas where CIOs have influence and can make a difference.

?Previous initiatives around business processes focused on process improvement in specific areas - HR, finance etc. Many of these were not finished, and initiatives in specific areas were never linked up. Thus there is a huge opportunity for CIOs to take costs out of the business and increase productivity.

?BI is another area over which CIOs have control, and also an area where a lot of work has been done over the past few years. CIOs are focusing on BI because it aids decision-making amongst the executive, and it aids smarter decision-making. This is important because the economic turnaround has not been as high as expected, and investments need to be tightly focused,? he says.

Linked to that, says Blosch, is the need for CIOs to get the necessary BI and business process skills into the IT department. ?In the US and Europe, getting skills is a big priority. IT as a profession has lost its gloss, and bright new graduates are looking in other areas,? he adds.

Challenges for the CIO in 2005, he says, include the fact that IT does not own the business processes it wants to improve, that IT creates change faster than the business can cope, the lack of skills, fuzzy accountability (which happens when IT is working on processes that it does not own, for example) and the ongoing problem of lack of credibility.