The budget season is upon us. Business leaders and professionals crunch the numbers of the present year, take into account the medium-term forecasts, and prepare their budgets for the next financial and calendar year. Tech Pro Research surveyed IT professionals to gauge the corporate sentiment towards IT budgets, and their findings bear positive notes for the IT department.
Business leaders are increasingly seeing IT budgets in a positive light. In fact, 89% of the companies expect their budget to either grow or stay at the current sizes in 2019. This budget expansion is attributed to a number of factors, and some of the most important of them are listed below:
1. Favorable business climate
2. A growing awareness of cyber threats and the importance of cybersecurity
3. Increased adoption of cloud services
4. Increasing recognition of technology’s ability to drive business growth and revenues
5. Expanding Shadow IT in organizations
There is now a paradigm shift in how the top management perceives the IT organization. IT now plays a central role in the organization’s growth strategy, and this means that CTOs have more say in the boardroom discussions not just regarding IT budgets, but also in the organization’s overall strategy.
Rise in Investments
Business leaders, especially the CEOs and CFOs, are looking at IT budgets as less of an expenditure and more of an investment. In fact, there is an across the board cognizance of the fact that technology is and will continue to be a key differentiator in many industries. Therefore, it is not just the investments in IT technology that are getting nods from the top management. The Board members are now more amenable to spend on the training of new and current employees in the latest technologies required to keep the organization in tune with the most recent developments in the industry. This also means a substantial growth in IT jobs over the course of the year.
It’s Not All Good News
One area where the IT department, and by extension CIOs and CTOs, are experiencing loss of control is with regards to the technology adoption by different units within the organization. Departments like sales, marketing, operations, and others are obtaining technology solutions from vendors without consulting the IT department at all. IT executives frown on Shadow IT because investments and expenditures into these technologies are pooled under the respective unit’s budgets and not under the IT, which fails to showcase the vital contribution of digital technology to various aspects of a business’s processes.
However, instead of taking a combative stance towards the Shadow IT, the IT department must play the role of an enabler and assist those departments in acquiring suitable technologies that deliver results. In the long run, this helps the IT department in focusing more of its resources on mission-critical aspects of the business.
This can lead to a win-win situation, which brings us to the next point.
Mounting Pressure on Vendors
IT heads are increasingly embracing the Shadow IT. They are enabling other departments within the organization to obtain superior and more effective technology solutions, while they are simultaneously focusing more of their energies on equipping their organization with a competitive advantage in the industry. Thus, vendors of Shadow IT solutions will now be dealing with a more sophisticated group with technical expertise in IT. Their solutions will be vetted more thoroughly and will be expected to showcase their product and service’s capabilities more tangibly via proofs of concept, demo, quantification of ROIs, or with sample scenarios and data.
In a nutshell, IT departments will play a more critical role in the organization’s long-term strategic decisions. Fortunately or unfortunately, this also means that they will be under pressure to consolidate their position and play a more strategic role, while ceding some ground to Shadow IT and let it take over some of the tactical aspects of organizational IT needs.