Goldman Sachs & Co. recently issued survey results around the state of
the IT economy.
According to the recent survey conducted by Goldman Sachs, IT spending
through 2009 will be on the decline and IT staffing will also suffer.
100 managers with strategic decision making authority (mostly CIOs at Fortune
1000 companies) answered the survey, and not surprisingly to many in the
industry, results showed an impending IT spending slip from 7 percent growth to
5 percent growth in 2008. Reduced spending was a major theme of the survey
results, and demands for discretionary IT projects have dropped to the lowest
levels in the ten year history of the survey. Bad news, but certainly not a
downturn of epic proportions.
The survey author wrote, "ROI is the name of the game. CIOs have emphasized
to us that they are buying on a need versus want basis, are often downsizing
deals to fit with current budget constraints, and are searching for solutions
with a high and fast ROI." Executives also appear to be shying away from over
hyped technologies and focusing on the tried and true.
Not everything was doom and gloom in the survey findings, however. In terms
of spending priorities for 2008 and 2009, server virtualization and server
consolidation ranked as number one and number two, making them the top
priorities for IT managers. Following these two items were cost cutting,
application integration, and then datacenter consolidation. Near the bottom of
the list was grid computing and cloud computing – perhaps thought of by some as
the “over hyped” technologies, or, perhaps just misunderstood.
The message here seems to be clear - that CIOs are looking for
well-understood technologies that can result in cost savings and increased
efficiencies. When budgets get tight, organizations re-evaluate where they can
begin to cut costs without sacrificing quality. Server virtualization, when
implemented correctly, can certainly provide the needed efficiencies and help
with cost savings. And once this environment is correctly implemented, one of
the next steps becomes leveraging an affordable management product to make the
best use of the environment, gain efficiencies and ROI, and help to maintain
existing staffing workloads through troubling economic times.