Consultants, hardware targets of spending cuts
The second survey by Goldman Sachs probed 2009 spending plans based on type of IT projects. This survey also showed cuts are in the offing. "ROI is the name of the game. CIOs have emphasized to us that they are buying on a need versus want basis, are often downsizing deals to fit with current budget constraints, and are searching for solutions with a high and fast ROI," the survey authors wrote.
The spending survey indicated CIOs see the "greatest potential for cost reduction in IT in the area of networking equipment." A full 47 per cent of the responders said the most likely area where spending would be slowed would be on purchases of personal computer systems, servers, and storage.
Spending cuts won't be limits to equipment: 42 per cent of the CIOs indicated that "they are reluctant to spend money on third-party professional services." This is in keeping with the decline in interest for discretionary IT projects and could indicate more of a reliance on in-house IT staff.
Cloud computing may get buzz, but it won't get spend
The CIOs surveyed indicated that server virtualization and server consolidation are their No. 1 and No. 2 priorities. Following these two are cost cutting, application integration, and datacenter consolidation. At the bottom of the list of IT priorities are grid computing, open source software, content management, and cloud computing (called on-demand/utility computing in the survey) -- less than 2 per cent of the respondents said cloud computing was a priority.
Charles King, a principal analyst with Pund-IT, said that such hot-button technologies like cloud computing deployments may slow down. "The message here is CIOs are looking primarily to tested, well-understood technologies that can result in savings or increased business efficiencies whose support can be argued from a financial point of view," he said.
One reason for the low priorities of grid computing, open source software, and cloud computing may be that CIOs and business executives don't understand their value. "They require a technical understanding to get to their importance. I don't think C-level executives and managers have that understanding," King said.