Prepare two IT budgets for ’08

Worldwide IT spending will surpass US$3 trillion in 2007, an 8 percent jump over last year, as rapid growth in developing countries is spreading IT investments more widely around the globe, Gartner reported recently.

A full one-third of IT spending now occurs outside of North America, Western Europe and Japan, the analyst firm said. Overall, IT spending is projected to reach $3.1 trillion this year and $3.3 trillion in 2008.

New IT spending outside the world’s traditional technology centers is creating new innovation, competitors, use patterns and improved cost-benefits for users, said Peter Sondergaard, senior vice president and global head of research at Gartner.

He also delivered some bad news: A possible recession next year could take a toll on IT budgets. He recommended creating two IT budgets for 2008. The first should reflect the same kind of marginal growth prepared during the past six years. The second should assume the need to cut costs in response to the arrival of a possible recession.

IT leaders must respond to change faster than ever before with programs and technology that stress flexibility and agility, according to Gartner. Sondergaard challenged IT executives to deliver new efficiencies, innovations and ideas to sustain profitability and growth.

“Simply delivering internally focused savings isn’t going to be enough,” he said. “You need to step up to the challenge of delivering new solutions to those critical business imperatives.”

End-user spending will globally move toward software, services, and all aspects of mobility, Gartner predicts. These categories made up 57 percent of spending in 2006, will become 60 percent in 2008, and are forecast to have grown to 63 percent in 2011.

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