News

IT Shops Still Spending Despite Downturn

• By Stephen Swoyer
• May 27, 2009

A recent study from IT staffing specialist Robert Half Technology suggests that CIOs plan to invest in new IT initiatives over the next year, in spite of a bad (and possibly worsening) economic climate.

Seventy percent of CIOs say they'll spend money on new or expanded IT initiatives, including information security (cited by 43 percent of respondents), virtualization (28 percent) and datacenter efficiency (27 percent).

The Robert Half study was based on a survey of more than 1,400 U.S. CIOs, all representing companies with 100 or more employees. The upshot, according to Robert Half researchers, is that CIOs aren't opposed to new spending, especially in segments that can help beef up security, improve efficiency or generate new revenues. However, Robert Half officials stress that the survey results don't necessarily augur an uptick in IT spending.

"Although times are lean, many companies are finding that they can't afford to postpone IT investments that lead to increased security, efficiencies or revenues," said Dave Willmer, executive director at Robert Half Technology, in a statement. "Organizations also are trying to make sure they are prepared for growth when conditions improve, and enhancing their IT infrastructure is part of that process."

Not everyone has the same spending priorities, of course. CIOs in the financial services and transportation sectors, for example, plan to focus on security spending; 60 percent of CIOs in both verticals anticipate spending money on new or expanded security-related projects in the coming year. That far outpaces the average (43 percent) for CIOs in all industries.

On the other hand, IT chiefs in just about all verticals seem to have virtualization on their mind. "Added budget pressures are forcing many companies to focus on more cost-effective solutions for servers, storage and networking," the Robert Half release said. "Virtualization tools enable greater consolidation, lower hardware costs, and reduced space and power requirements." In fact, 40 percent of CIOs at both large and midsize organizations (companies with 500 or more employees) are looking at virtualization projects.

Elsewhere, IT chiefs plan to spend money to boost the efficiency of their datacenters, largely to eliminate costly datacenter expansion efforts, which IT executives see as stemming from poor planning or inefficient use and/or allocation of datacenter resources.

Other spending priorities include VoIP (cited by 26 percent), which executives expect will both reduce monthly phone bills and translate into "greater network flexibility and unified messaging." IT chiefs are also eying increased Software as a Service (SaaS) spending, which Robert Half said is "particularly attractive" in shops that have slashed their budgets. Just over a quarter of CIOs anticipate spending more on SaaS.

Finally, one-fifth of respondents anticipate spending to support "green IT" initiatives; 19 percent expect to allocate new or additional money for business intelligence; and a staggering 18 percent say they plan to allocate funding for social networking projects. Web 2.0 (at 17 percent) and outsourcing (at 16 percent) spending rounded out Robert Half's survey sample.