'Age of the customer' drives shrinking IT budget for CIOs

'Age of the customer' drives shrinking IT budget for CIOs

Marketers lead the charge towards "Shadow IT"


The "age of the customer" is driving a shrinking IT budget for CIOs as marketers lead the charge towards shadow IT.

That's according to Forrester Research analyst, Tim Sheedy, who gave a keynote presentation at the recent NewLease hosting day in Sydney.

The event provided insights into real market trends and offered delegates a selection of workshops that showcased services to help drive business growth.

Sheedy said marketers were driving a huge amount of the technology spend as they focused on mobility and analytics in the "age of the customer".

"We are in a time where we get competitive advantage from being customer focused," he said.

"I'm spending more and more time speaking to marketing professionals because these are the people making the technology decisions going forward.

He said people were going beyond the IT department and that the total amount of money spent on tech by the IT deparment was getting smaller.

"The tech spending from the IT deparment is shrinking and that's a really key fact if you're selling into that technology department," Sheedy said.

"And that's because marketing is leading the charge towards this shadow IT piece."

However, Sheedy has forecasted that the pendulum would swing back to the IT department.

"I think IT will go backup again and I think IT will start to take control, and I see this in a few CIOs that I speak to, and these are the ones who are re-engineering their business to operate at the speed of the customer," he said.

"Marketing gets this idea of the age of the customer and IT is not keeping up with them.

"So they are going out of IT to do it in order to operate at the speed of the customer."

Sheedy said this was playing out in some of the budgets in Australia with 30 per cent of the spend on new projects.

"That 30 per cent will jump up to 42 per cent in Australia this year," he said.

"The reason we are planning to spend 42 per cent on new projects is that we are making massive savings by moving to the Cloud."

The swing back to IT will also be driven by burgeoning mobile business and the rapid adoption of Cloud.

Mobile is driving a huge amount of spend because its the way customer wants to interact with us," he said.

"Australia is going to become the second greatest adopter of Cloud behind the US.

"Australia is very much a fast follower and we are adopting Cloud at a rate which is surprising everyone."

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Tags shadow ITtim sheedyNew LeaseForrester Research analayst

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