Australian IT spend higher than the global average

Australia’s IT budgets are set to increase by 3.6 per cent in 2005, which is well above the global average of 2.5 per cent. The improved spend is higher than last year’s rate of growth in Australia — a dismal 1.2 per cent.

In fact, Australian IT budgets in 2004 fell below the global average of 1.4 per cent, according to the results of an annual Gartner survey of 1,300 CIOs in 30 countries representing US$57 billion in IT spending.

Despite the surprisingly optimistic budget results, other findings were not so upbeat particularly when it came to rating business priorities.

For example Australian CIOs said they were increasingly concerned about their relationship with the CEO and were also more concerned about enterprise risk than their overseas counterparts.

Another notable finding was that overseas, CIOs rated revenue growth as a priority whereas it didn’t even make the top 10 for Australian CIOs.

Gartner research director Andrew Rowsell-Jones said one explanation is that the role of a CIO in Australia may not include contributing to revenue growth.

“Maybe CIOs here are still seen as technologists, rather than business leaders,” he said adding that the business growth theme was central to the top 10 priorities for overseas CIOs, whereas locally the focus was on consolidation and improving IT governance.

Infrastructure integration might be unglamorous but it ranked highly, which shows a typical Australian CIO’s dogged determination to keep working until the job is done.”

Commenting on the survey results, Batey Red Cell IT manager Henry Tam agreed IT budgets are improving after a period of tight cost control.

“A lot of companies cut back last year and everyone seemed to suffer,” he said.

“It also depends on the relationship you have with the CEO; a lot of CEOs don’t know what is required by the IT department. However, if a CEO does have an understanding of IT then a much better relationship will exist.”

Tam said improving efficiencies and consolidation is no longer at the top of his priority list.

“Our main priority this year will be communications, mainly focusing on wireless and mobile technology,” he added.

The top 10 business priorities identified in the survey for CIOs in Australia and New Zealand include business process improvement, stemming security breaches and disruptions, enterprise-wide operating costs, supporting competitive advantage, CRM, enterprise risk management, overcoming a shortage of business skills, using intelligence in products and services, data protection and privacy as well as focusing on internal controls.