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Tight budgets herald year of change for IT heads

Middle East: Tuesday, February 10 - 2009 @ 11:03

IT budgets globally will be flat this year, with analysts IDC predicting they will rise just 0.5%, dragged down by negative cuts in western markets.

But the good news for those in the Middle East is that IT budgets are likely to buck the trend, with growth of around 8%.

Still smaller than the previously predicted double digit growth, the budgets are expected to come with the clear message to IT heads that any spend must show a quick return on investment.

‘The distribution of IT budgets is going to change. The focus is going to be on how can IT enable business? How can IT support new business opportunities?’ Jyoti Lalchandani, IDC Vice President for Middle East, Turkey and Africa told AME Info.

Those heading IT departments are likely to face many problems this year, particularly around losing members of their team, keeping up subsequent morale and filling in the missing skills.

‘IT is so critical to what businesses have to do. At the same time they have all these disruptive technologies and trends underway,’ said John Gantz, Chief Research Officer at IDC, speaking at the company’s CIO Summit in Dubai.

This disruption will make virtualisation and cloud computing all the more attractive, as companies look to reduce costs and move towards pay per use models.

IDC believes that in 2009 shipments of virtual servers will match those of physical servers. It is expected to be a particularly hard year for server distributions, as the industry consolidates and moves towards managed IT services.

This will also boost the security and networking communities, as companies will expect improvements in both if they are to see critical data potentially shift off-site. For IT heads, it will mean implementing a good service and support infrastructure, to manage these more complex relationships.

While this gives the impression that the industry is predicting free-flowing IT spending in the Middle East, the key to any projects likely to get the green light is that it will quickly have a direct, positive impact on the company’s bottom line.

Integration between business and IT

It also raises the thorny old issue in the technology world of tighter integration between IT and the various business units, so that IT truly understands the needs of business and business clearly explains how it needs the help of technology.

‘In many organisations in the [Middle East] region IT heads are not even aware of business initiative that are being carried out, so are not able to plan and execute projects. The recommendation is to involve your CIOs in your business planning, because they can really add value in helping the business grow,’ said Lalchandani.

Gantz believes that ‘IT and business units have to be in the same lifeboat to be successful’, but with the upshot that the IT domain will grow out of this economic crisis.

If a technical operation touches IT, IDC believes it will become the responsibility of the CIO if it is not already. Examples, the analysts said, were areas such as security cameras or IP phones.

‘If it runs on the IT network, IT will end up managing it,’ said Gantz.

See also:
CIOs must integrate closer with key business divisions
Injazat targets Dubai and Qatar for data services

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Tuesday, February 10- 2009 @ 11:03 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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