More IT Spending to Go Into Mobile, BI and Cloud

The latest CIO Tech Priorities research reveals that head IT-decision makers intend to heighten spending over the next year. It is anticipated that the biggest amount of this spending will go towards cloud computing services, mobile technology, and finally, business intelligence and analytics (BI&A).

According to the most recent CIO Magazine Tech Poll/Tech Priorities survey, IT budgets are expected to increase in the next year and mobile technology investments are likely to take the biggest portion. The other realms that are expected to use a significant share of the increased budget include cloud computing services and BI&A.

The CIO survey results discovered that 48 percent of the respondents believe that the next year will bring a surge in IT spending. Thirty-nine percent reported that budgets will remain the same, and the additional 13 percent expect budget cuts for IT.

These figures are supported by similar findings from the survey taken earlier this year in January. In this survey, 46 percent anticipated higher spending in the next year, 38 percent believed that it would neither increase nor decrease, and 16 percent of respondents reported a decline in spending for the coming year.

The driving force behind increased spending, according to 35 percent of responding organizations, is business process innovation. For 22 percent of these organizations, the driver for heightened spending is split between two areas. These two areas include increased efficiency for IT infrastructure management and generating top line revenue growth. Finally, 18 percent of participating organizations reported that lowering business operation costs are their main priority.

Lee S. Murray, director of IT at Troy Design & Manufacturing Co., says that they intend to increase their operating budget of approximately 15 percent and a 20 percent increase for their capital acquisitions budget in 2013.

As previously mentioned, the predominating reason for increased spending is to better the business over. Murray expects there to be a rise in spending for fundamental technologies, in addition to more capital gains leading to exponential growth within the organization. He continues with the statement that “there is also momentum for mobile deployments” and they are “moving as rapidly as we can into this area.”

This area of mobile technology is a popular investment option for CIOs as 58 percent reported that they plan to increase spending within the next year. Furthermore, many businesses are already in the processes of piloting new mobile technology options. Of the IT leader survey participants, 25 percent reported that they are currently piloting new mobile technology, 20 percent are experimenting with tablets, and 19 percent are in the beginning stages of using various social media and collaboration tools.

The main driver behind increased IT spending for Hargrove Inc. is also revenue growth. This event company concentrates primarily in trade show management, exhibition design, and production of special events.

Hargrove’s CIO, Barr Snyderwine, discusses the importance of customer-facing applications for their IT efforts. These applications that allow for an improved customer experience and focus on customer retention for the company.

According to Snyderwine, “the company is in the process of deploying tablets and uses cloud apps where appropriate.” Additionally, this company is actively creating new mobile client apps in order to simplify the customer’s all around experience.

When CIOs look to the next year, business intelligence and analytics stands out as a focal point on the radar. After the 39 percent of CIOs who say this, business process management follows closely with 36 percent. The rest of the responses and their corresponding percentages are as follows: cloud external public has 32 percent, social media and collaboration tools with 31 percent, and cloud internal/private rounds it off with 31 percent.

Snyderwine supports these findings with his personal experience of talking to other CIOs as well. He adds that gathering more raw data for the business managers is vital when tracking the task level in order to obtain the most holistic look at business operations. Snyderwine is also examining these BI&A options for Hargrove, Inc.

At Troy Design & Manufacturing, this is also the case. Murray claims that “when it comes to BI&A our plan forward is still in development with investments expected to increase over the next 12 months.” He adds that they are “on a never-ending mission of data mining in support of continuous improvement measures.”

The most recent CIO survey shows that the overall business investment trend continues to shift away from core technologies towards edge technologies, including tablets, cloud, mobile, and BI&A.

For Galata Chemicals, the cloud technology investment is necessary to help reduce costs. The director of IT at this midsized global business, Phillip Andrews, explains that “we’ve been in the cloud with our desktops, SAP, antivirus, telecom as well as several other SaaS applications.” He further adds that because their business is global, they are required to play large by leveraged resources.

Galata also happens to be one of the survey participants that reported their IT spending will decrease over the next year in order to aid in cost reduction for the company.

On the other hand, server virtualization is something that is in production but off the radar for most businesses. A very solid 65 percent of responding companies say that sever virtualization is in the works within their businesses. An additional 49 percent reported that they are in production with enterprise-wide server virtualization, while 16 percent say that this server virtualization is in the works for the business units or divisions.

Another finding from the recent survey show that five percent of survey participants claimed that they are in the process of piloting this particular technology, whereas 10 percent report upgrades or refining to pre-existing virtualization infrastructure.

According to the survey respondents, the other major technologies currently in production either at the business, division, or enterprise level include hardware infrastructure, such as desktop or laptop upgrades (with 48 percent), hardware infrastructure on devices like smartphones (43 percent), and data management (42 percent). A final three-way tie of 41 percent includes customer service/CRM, enterprise resource planning, and video teleconferences or telepresence. (RP) Link