Increased Focus on External Customer Continues in Upcoming Year
Framingham, Mass. – May 27, 2015 – IDG’s CIO—the executive-level IT media brand providing insight into business technology leadership— reveals the CIO Tech Poll: IT Economic Outlook results for May 2015. The research indicates that half of organizations (50%) are increasing IT budgets within the next year, and overall IT budgets are increasing by 6.4%. As IT leaders look at their organizational needs, a majority (61%) will increase spending on new projects in the coming year. Edge technology spending, including mobile, social, CRM, M-commerce and marketing automation, continues to trend upward in the next one to three years.
Plans For New Project Spending Climbs Sharply
New or discretionary IT budget allocations have soared in the past year. In 2014, 47% of IT leaders said they would increase spending on new projects. This has jumped to 61% this year, which is the highest percentage since the question was first asked in 2009 (25%). Thirty-nine percent of new project spending will be on projects that help increase top line revenue. With one-third of IT budgets being spent on edge technologies, like the SMAC stack (Social, Mobile, Analytics, Cloud), organizations are looking to invest in new companies. Forty-six percent of CIOs surveyed plan to increase spending with new technology companies.
“Emerging technologies are the key to enterprise innovation. IT leaders are spending time learning about these new technologies, and the vendors creating them, and are allocating budget for technologies like the SMAC stack,” said Adam Dennison, SVP and publisher, CIO. “Enterprises are looking for the best solution and are not worried that those solutions are coming from ‘straight-to-the-enterprise start-ups.’ Emerging tech vendors should take this cue to showcase how their agile and innovative technology solutions can help businesses succeed.”
Increased Focus Continues on External Customer
External customers are a big focus for new IT projects. Nearly three-quarters (73%) believe IT is interacting with external customers more than two years ago while 37% will focus their new IT spending on external customer interaction, relationship or experience-related investments, up from 33% in 2013. Looking at the budget allocation, CIOs currently allocate 68% of their budget for core technologies like infrastructure, network, storage and 32% to newer “edge” technologies. However, in the next one to three years, the budget allocation for core technologies drops to 55% and the budget for edge technologies increases to 45% of their budgets.
IT Remains Involved in Technology Purchases Funded Outside of IT
Over three-quarters of IT leaders surveyed (76%) said they have a policy or process to ensure IT remains involved in tech purchases to reaffirm there is the right level of support and oversight from IT to keep problems at bay. When technology purchases are funded by other departments or functions, 58%say IT’s involvement varies depending on the individual department’s experience and expertise as well as on the scope of the project. In fact, 50% of IT leaders said line of business (LOB) counterparts identified their specific business need and came to IT for recommendations on technology and solution providers. For 21% of the CIOs we surveyed IT identifies the business need and makes recommendations regarding technology solutions or providers while 16% say LOB identifies the need and solution/provider then brings to IT for vetting. Just three percent say IT is not typically involved unless a problem arises and only one percent believe IT is not involved even if there’s a problem.