Worldwide IT budgets projected to decline

CIOs experienced significant IT budget revisions in the first quarter of this year, as executives gained a greater understanding and solidified plans for addressing the global financial crisis, according to a global survey of 900 CIOs by Gartner Executive Programs.

CIOs experienced significant IT budget revisions in the first quarter of this year, as executives gained a greater understanding and solidified plans for addressing the global financial crisis, according to a global survey of 900 CIOs by Gartner Executive Programs.

The survey was conducted from March 1 to April 30 2009 and sought to gauge the potential impact of macroeconomic concerns on IT budgets so far this year. These CIOs encompass more than $77bn in revised IT spending.

Forty-six per cent of CIOs surveyed from March 01 to April 30 2009 reported that that their 2009 IT budgets had changed since it was finalised. The results of this survey were compared with the results of the Gartner EXP 2009 CIO Survey, conducted from September to December 2008, which had over 1,500 responses.

CIOs in the previous survey reported a flat budget, with a minor increase of 0.16 per cent. CIOs responding to the survey in the first quarter of 2009 now report a weighted average decline of 4.7 per cent. More than 90 per cent of enterprises changing their budgets made a reduction in Q1, with the average reduction being 7.2 per cent. Fifty-four per cent of respondents reported no change in their IT budget, with the remaining 4 per cent reporting an actual increase in their IT budget.

“CIOs reported that renegotiating vendor contracts and head count reductions were the primary focus areas for accommodating budget reductions,” says group vice president & head of research at Gartner EXP Mark McDonald. “CIOs report shifting more work to in-house resources, and delaying capital expenditures more than reducing IT project investments.”

CIOs recognise the potential for further cuts in 2009, McDonald adds, but most see that as “unlikely”. The percentage of CIOs with a contingency plan for the remainder of 2009 has more than doubled compared with 2008.

CIOs with additional contingency plans for 2009 are planning for the potential of renewed IT spending, as well as additional reductions. While 44 per cent of CIOs do not believe they will need to tap into their contingency plans, those that do believe they will do so during the next six months.
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More information:
www.gartner.com/exp.

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