CIOs paying for upgrades by cutting operational budgets
1 min read
CIOs are reporting that IT spending has been consistent with budget plans from the end of 2009 to date – but that priorities are forcing purchasing changes.
That's the news according to a global survey of more than 500 CIOs conducted by Gartner Executive Programs, which shows that IT budgets remain essentially flat in 2010 – growing just 1.1% – in line Gartner's survey of 1,600 CIOs in Q4 2009.
"Economic conditions are changing CIO spending priorities as the need to upgrade infrastructure is being appropriated from reduced operating budgets," comments Mark McDonald, group vice president and head of research at Gartner Executive Programs.
"Commercial and public sector CIOs plan to increase capex by 3% this year and pay for that increase with a 1.3% cut in operating budgets. CIOs felt they could no longer delay infrastructure upgrades and other capital investments and they funded them at the expense of operating budgets," he adds.
McDonald says IT organisations, particularly larger ones, are not increasing the budgets assigned to IT; instead, CIOs are swapping one set of budget items for another.
"Size certainly matters in terms of IT budget outlook," he says. "Smaller organisations report significantly stronger IT budget growth percentages than their larger counterparts. The larger the organisation, the tighter it is managing its IT budget in general, and IT operating expense in particular."
That continues a trend Gartner identified back in 2008, as larger IT organisations started reducing their resource requirements through consolidation, waste elimination and other measures.
