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Posted by Tim Sheedy on August 18, 2009
I recently completed a report comparing the movements and trends in IT budgets across different countries across the Asia Pacific region. The general finding of the report was that although IT budgets are down on average, there is a chasm appearing between the "haves and have nots" for IT spend. In summary, while the average decrease in IT budget decrease is around 5%, of those companies getting an increased IT budget, their spend increased by between 15-20% on average, and for those receiving an IT budget cut, the decrease was often around 20%. The decisive factor on the direction of the IT budget was often the level of exposure to the global financial crisis. Those with a high level have seen the highest budget cuts, those with low levels of exposure (or those profiting from the crisis) are seeing increases or flat IT budgets.
But as is often the case with statistics, they do not tell the entire story. What is becoming clear is that even those companies with increased IT budgets are looking to decrease their IT spend in as many areas as possible. Much of the interest in the region in cloud computing has actually come from the public sector - one of the sectors that has been relatively sheltered from the slowdown in IT spend. Virtualisation is on the agenda for nearly all companies, as they look to make better use of the hardware that they already have.
Reducing "human" costs through the reduced usage of contractors and IT services firms is on the agenda for many companies. The following figure shows the types of activities being undertaken by firms in Asia Pacific in attempting to reduce their IT spend. Please note that the averages in most countries are much higher - but the Chinese respondents to the survey bought the averages down, as they are taking fewer actions to reduce IT spend compared to enterprises in other countries.
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