CIOs Forecast IT Investment Trends for Upcoming Year

Even in the face of mass layoffs and increasingly tight budgets, seven out of 10 CIOs expect their companies to invest in various IT initiatives in the upcoming year, shows a recent survey by Robert Half Technology, a provider of information technology professionals.

“The big thing is [to invest in] what can save money or make money, [so] things like virtualization, data-center efficiency, voice-over-IP (VoIP) and Web-related projects have not been put on hold,” explained Dave Willmer, executive director for Robert Half Technology.

Topping the list of IT investment areas most frequently cited by CIOs is information security (43 percent).

“Outsourcing tends to come up when budgets are a little lean,” Willmer said. “When you’re outsourcing and using outside vendors, the need for tight security IT-wise is there.”

In addition, the “biggest culprits” for security breaches tends to be internal employees, so it’s particularly important to ensure information security in the wake of layoffs, Willmer explained.

“With some industries, having a competitive advantage is important. Trade secrets or whatever your latest package or rollout or product [must be kept confidential], so security is at a high point right now for a lot of CIOs,” he said.

Twenty-eight percent of respondents also cited virtualization as a priority, followed by data-center efficiency (27 percent), VoIP (26 percent) and software as a service (26 percent).

Other areas of IT investment on the list were green IT, business intelligence, social networking, Web 2.0 and outsourcing.

Companies can least afford to cut back on or postpone certain IT investments because it could negatively impact the bottom line.

Take, for instance, a big enterprise resource planning (ERP) implementation that a company may have completed in 2008.

Willmer explained that a company that has just spent a million dollars on an ERP rollout may want to hold off on spending another quarter million to maintain and train its workforce, adding that it’s important to consider “not only saving money [or] making money but also lengthening the return on investment that you made last year.”

The long-term benefits of essential investments are particularly important during recessionary times, as this could affect a company’s ability to maintain a competitive advantage.

“Are you going to be prepared as a company when this [economic downturn] turns around?” Willmer asked. “Most well-run companies that continue to invest actually do better when they come out of the downturn because they’ve made the right investment in the right areas — and some of those may be IT related.”

Looking beyond the next 12 months, Willmer said it’s safe to predict that companies will continue to make Web-related investments.

“It’s all about the Web,” he said. “As companies continue to take advantage of what could happen when you go virtual — whether that’s [business-to-business], branding and marketing or research — [companies’ growing investment in their] Web presence is not going to go away.”

– Deanna Hartley, dhartley@certmag.com

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Deanna Hartley

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