Most CIOs will increase IT spend this year

  • Len Rust (Computerworld)
  • 13 February, 2001 15:00

Fears of an impending economic slowdown are not necessarily reducing IT procurement budgets at Global 2000 corporations, according to a survey by Gartner Group. The company found that 65 per cent of respondents expect to increase IT budgets by 13 per cent in 2001. While this figure may change due to self-fulfilling prophesies and perceptions, Gartner analysts encourage executives to continue spending wisely on technology - the weapon of choice in carving a competitive advantage in today's global business environment.

According to Gartner, CIOs are putting a fine point on the vendor selection process in order to drive maximum competitive advantage in their technology procurements. Project teams have intensified their efforts to identify more rigorous methodologies for selecting the equipment, software and services that they purchase.

In addition to addressing the challenges inherent in IT decisions, project teams must now counter the inevitable lengthening of purchasing cycles because of the talk of an economic slowdown. Now more than ever, IT executives and the project teams they sponsor must be absolutely sure that the technology selections they make exactly meet comprehensively defined requirements.

Lengthening sales cycles will affect the cash flow of IT vendors, many of which have already been pummeled by Wall Street in the technology market meltdown of the past several months. The competitive positioning of major companies in all industries will also be affected. Delays in purchasing also translate into delayed installations of such business-transforming systems as enterprise resource planning (ERP), e-commerce and customer relationship management (CRM) applications.

In this resource-constrained environment, competitive advantage will continue to accrue to companies that can install and implement the optimal IT infrastructure for their businesses before their competitors can.