As 2007 counts down, CIOs should make hay while the budgetary sun shines

Countdown for the last 100 days of 2007

With fewer than 100 days before the end of 2007, there is a quickly-closing window of opportunity for CIOs to ensure their strategic goals for the year have been met. Because IDC forecasts that technology budgets will be under intense pressure in 2008, the message to CIOs is to spend now while you can.

  • IDC believes that ICT budgets are stalling. They are not keeping pace with inflation, and growth forecasts predict only a 3.2 per cent growth for 2007. Australian business spending on hardware, software, services, and communications will fall just short of the $A40 billion mark for the year, topping out at $A39.3 billion, according to IDC projections.

  • However, spending on security will increase despite the pressure on budgets. By the end of 2007, spending on security solutions in Australia and NZ will have grown 13.6 per cent to $A1.35 billion.

  • The skills crisis is accelerating the move to offshore. Recruiting and retaining skilled staff leapt up the priority rankings in IDC's company surveys. The skills shortage is also appearing as a key driver in the movement of work offshore. Expect this to continue into 2008.

  • Industry consolidation will continue as competitive market dynamics give vendors a nudge down the acquisition path. Expect also to see more channel and partner initiatives as companies look to consolidate their market positions.

  • Greater growth in green computing will occur as the seeding of interest in green computing issues begins to take root and the vendor community will increasingly look at ways to emphasise their own credentials and initiatives.
"The timetable for achieving 2007's goals is rapidly drawing to a close. For CIOs the message is that budgets are likely to be under extreme pressure next year -- think 'smarter spending' in 2008," said Tim Dillon, IDC's associate vice president of research.

Len Rust is publisher of The Rust Report

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