Government CIOs prepare for budget cuts

More than a quarter of government CIOs globally expect a budget decrease in 2014, Gartner says

Tags: Gartner Inc. (www.gartner.com/technology/home.jsp)
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Government CIOs prepare for budget cuts Gartner: Federal and national government agencies remain under pressure to cut IT budgets and services
By  Tom Paye Published  May 8, 2014

According to Gartner's 2014 CIO survey, 26% of government CIOs expect budget decreases in 2014, compared with the global average of 17% of CIOs.

Around the world, federal and national government agencies, including defence, remain under pressure to cut IT programme budgets and services, Gartner said.

"Reflecting the extended budget development and appropriation cycles that are typical of public-sector institutions, 26% of government CIOs anticipate a budget decrease in 2014, as compared to the 27% who expected to be working with lower IT budgets in 2013," said Rick Howard, research director at Gartner. 

"However, with nearly 75% of government CIOs reporting flat or increasing IT budgets for the second year in a row, many government CIOs have an ongoing opportunity to build capacity in high-value areas - such as mobile services and business analytics - while retooling IT portfolios to include more software as a service (SaaS) and public cloud solutions." 

The picture is less optimistic for federal and national governments that are under pressure to cut IT programmes and services, Gartner said.

Meanwhile, Gartner's CIO survey also indicated that, overall, government CIOs estimate around 33% of IT expenditures are now being made by business units, and outside the authority of the IT organisation.

This indicates a need for government CIOs to quickly and clearly differentiate their portfolios of high-value IT solutions and products from the commoditised IT services traditionally associated with in-house IT organisations, Gartner said.

"Regardless of how much IT spending happens outside of the IT organisation, CIOs must address the presence of shadow IT by affirming their position as the designated and recognised point of IT management responsibility," said Howard. 

"This doesn't mean CIOs should attempt to restrict business-managed IT acquisitions and services. However, accountability for the information assets of a government agency cannot be distributed, and governance will ensure a corporate officer, the CIO, is at the table whenever or wherever an IT investment is being considered.

"To maintain organisational relevance in today's digital industrial economy, CIOs need to work in collaboration with their executive peers to strike the optimal balance of 'grow' and 'transform' with running the business."

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