Expenditure for Software Development and IT Governance Expected to Grow

Concord, Mass. — May 29
A new national study conducted by The Gantry Group LLC, “Software Development & IT Governance Expenditures & Trends,” reveals that a company’s annual budget for these solutions and services, on average, will grow to $1.2 million in the next 12 months.

Companies will increase allocations in their budgets for key solution areas: 6 percent for portfolio management, 4 percent for project management, 3 percent for product life-cycle management (PLM), 2 percent for integrated project and portfolio management (PPM) and 2 percent for requirements management.

Respondents reported that within the next 12 months, their organizations plan to implement solutions for PPM (25 percent) and process workflow management (20 percent). Companies show a strong preference for third-party, on-premise solutions for all categories of IT investment with the exception of demand management, for which custom in-house solutions are preferred.

According to the study, respondents prefer third-party solutions to outsourced services primarily because they want to maintain control over data quality, privacy and security (48 percent) and believe they will also derive greater control over solution access and performance (45 percent), as well as improved integration with existing systems.

The study solicited feedback from C-level IT executives and vice presidents (50 percent), IT/development directors (18 percent) and managers (12 percent). Sixty-six percent of respondents have responsibility for IT/product development, program management or IT governance.

Nearly 25 percent of respondents came from companies with 5,000 or more employees, while 27 percent came from companies with 1,000-5,000 employees and 28 percent came from companies with 250-1,000 employees.

The study revealed the following additional findings:

  • The key metrics that companies use to determine the success of their development and IT governance solutions are alignment of IT investments with corporate objectives (52 percent), followed by expected ROI (45 percent) and alignment of IT projects with corporate objectives (44 percent).
  • The majority of respondents believe their development and IT governance solution deployments have benefited their organizations through improved alignment of both IT investment (52 percent) and projects (41 percent) with corporate objectives.
  • Respondents are least satisfied with their deployed solutions for PPM, PLM, time management and resource management.
  • Dissatisfaction with development and IT governance solutions arises primarily from poor employee adoption (50 percent), poor integration with the company’s infrastructure (50 percent) and an increase in process complexity and workflows (44 percent).
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