Cost still a priority for CIOs

3 Jun 2004

Despite the improving global economy, cost management remains a priority for IT heads across the world, an industry forum hosted by Microsoft heard this morning.

Speaking at the Microsoft Ireland CIO round table forum in Dublin, Charles Chang, vice-president and executive programme director at Gartner, outlined the findings of research conducted by Gartner among 2,000 CIOs worldwide, including 20 in Ireland.

The top IS management priorities highlighted by CIOs in Ireland and the UK included providing leadership and guidance on IT at board level, demonstrating the business value of IT, monitoring the quality of IS service delivery and ensuring data security and privacy.

In terms of IT budgets, the CIOs predicted a small, 1.4pc increase for 2004 with much of it happening in the second half of the year. This is still way short of the double-digit growth experienced between 1998 and 2001. But while budgets had started to expand again, there was pressure to keep a lid on costs and extract greater business value from IT, the poll found.

“The days of writing blank cheques for IT transformation are gone; it’s all about total cost of ownership and business value,” commented Harry Largey, group manager, enterprise and partner group, Microsoft Ireland.

He hoped that this cautious attitude would continue to prevail over the coming months. “As we go through the IT investment cycle, IT should be seen as delivering assets to the business so as to avoid repeating the mistakes of the dot-com era. I hope spending patterns will stay anchored to the total cost of ownership principles.”

Chang felt that while in many organisations there is a closer alignment of IT with business goals and strategy than in the past, CIOs were still struggling to get their views heard. “The vast majority of CIOs are very business oriented and know a lot about the company but are still treated as the IT director and not involved in decision making from the outset.”

Another tough challenge facing CIOs, he added, was defining business value and managing internal expectations of what could be achieved. “Business value, like beauty, is in the eye of the beholder,” he said. “It depends what part of the business you are in. Technology that makes a huge difference to distribution may mean nothing to the people in another part of the business.”

By Brian Skelly