cio it budget & staffing survey

Impact of the Economy on IT Spending

Exclusive CIO Magazine SurveyOctober 2008

Budgets Decreasing

Q: Compared to the past 12 months, will your overall IT budget in the next 12 months increase, decrease or remain the same?

October 2008

March 2008

June 2008

Increase49%

Remain the Same26%

Decrease26%

Remain the Same20%

Decrease17%

Increase63%

Remain the Same34%

Increase26%

Decrease40%

Source: October 2008 CIO Magazine IT Budget & Staffing Survey

Budget Category Trend

IT Compensation Costs

Software

Hardware

Telecommunications

Outsourced IT Services

Increase DecreaseRemain the

Same

37%

34%

33%

25%

24%

18%

37%

36%

29%

29%

45%

29%

35%

45%

43%

Q: Will your budget within each of the following categories increase, decrease or remain the same in the next 12 months compared to the past 12 months?Source: October 2008 CIO Magazine IT Budget & Staffing Survey

Contingency Plan

Yes,Contingency plan currently in place

51%

No,Planning to implement a contingency plan26%

No plans for contingency plan23%

Q: Do you have a contingency plan in place in the event you need to make cuts to your IT budget?

October 2008

June 2008No, Planning to

implement a contingency plan

20%

Yes,Contingency plan currently in place

48%No plans for

contingency plan32%


Implementing the Contingency Plan

No plans to implement at this

time48%

Currently implementing

35%

Planning to implement in the

next 6 months17%

Q: Are you implementing or planning to implement your contingency plan? (base: 123)


Business Measures Being Taken

Postpone discretionary IT

projects

Freeze It Hiring

Renegotiate IT vendor contracts

Restrict IT travel

Freeze of postpone desktop refresh

Consider alternative IT

modelsReduce spending on training for IT staff

Reduce IT headcount

Reduce spending on IT contractors and

consultants

Started in the last 6 months

Plan to start in the next 6 months

No plans at this time

26%

46%

46%

45%

44%

31%

49%

25%

23%

23%

13%

23%

12%

21%

15%

16%

13%

11%

28%

41%

31%

43%

35%

54%

58%

62%

66%

Q: Which of the following measures has your IT organization taken of is considering taking as a result of current economic conditions?


Primary Focus of IT Investments

Enable business process

innovation33%

Lower the operating cost

of IT24%

Manage IT infrastructure more

efficiently23%Create topline

revenue growth20%

Q: What will be the primary focus of your investments in the next 12 months? (select one)

Enable business process

innovation38%

Create topline

revenue growth

21%

Manage IT infrastructure more

efficiently19%

Lower the operating cost

of IT22%

June 2008

October 2008


Factors Driving IT Investments

ROI59%

TCO41%

Q: What will be the most important factor driving your IT investments the next 12 months?


IT Purchase Decisions and the Economy

No51%

Yes35%

Not sure14%

Q: Will current economic conditions cause IT purchase decisions to be pushed higher within your IT organization?


Technology Purchases

In the next 6 months do you anticipate delaying or cancelling any technology purchases as a result of unfavorable financing terms or conditions from a vendor or lending institution? (select all that apply)Base: 243

Count Percent of sample answering

Yes, expect to delay 85 35%

Yes, expect to cancel 25 10%

No 143 59%

Q: In the past 6 months have you delayed or cancelled any technology purchases as a result of unfavorable financing terms or conditions from a vendor or lending institutions? (select all that apply). Base: 243


Methodology

• The CIO IT Budget & Staffing survey was conducted online between October 17 and October 22, 2008 with the objective of gauging how current economic conditions are impacting IT spending plans. An email invitation containing a link to the survey was served on CIO.com and sent to a sample from the CIO customer database.

• Survey findings are based on 243 respondents.

• The margin of error on a sample size of 243 is +/- 6.3 percent. Percents on questions where respondents could select only one answer may not sum to 100 due to rounding.


Respondent Profile

• All respondents indicated they are the top IT executive at their company or business unit.

• A broad range of industries are represented including education (10 percent), manufacturing (8 percent), finance (7 percent), wholesaler/retailer/distributor (6 percent) and healthcare (6 percent) and government (5 percent).

• Company size distribution is as follows: <$100 million: 34 percent, $100 million - $999.9 million: 34 percent, $1 billion or more: 18 percent, not applicable/non-profit: 11 percent (2 percent of respondents were unsure).
