The Cloud

IT Pros to Finance: We Need More Budget

Information technology managers "are starting to get a bit frustrated" with little to no annual budget increases, says Computer Economics.
Matthew HellerDecember 18, 2019

While IT professionals have a positive outlook for the global economy, they are expecting only modest increases to their budgets next year, according to a Computer Economics survey.

The research firm reported in its Worldwide IT Spending and Staffing Outlook for 2020 that none of the companies it surveyed is expecting more than a 3% budget increase at the median. IT heads of large companies are expecting no increases.

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“This story of modest budget increases has been told for about a decade now, and managers are starting to get a bit frustrated,” Computer Economics stated.

“One manager may have summed up 2020 best when he commented in our survey, ‘[Our outlook] would be good if senior management would allow us to increase our budget in line with the increase in revenue.’”

Other IT directors commented that “IT needs to be considered an investment not an expense” and “the budget is inadequate. Attention to risks and opportunities at [the] C-suite level is also inadequate.”

The shift to cloud computing has increased efficiency, allowing companies to moderate their need for large increases in IT spending. But David Wagner, vice president of research for Computer Economics, noted that many of the “easier cloud projects are now complete, and finding budget for new projects is getting harder.”

“IT leaders know how they can transform their departments, but they are not getting much help from the business in terms of budget increases,” he added.

The survey also found that a net 71% of IT organizations plan to increase spending on security,  a net negative 7% of companies plan increases in data-center spending. In the United Sates and Canada, a net of 9.2% plan to cut data-center spending.

“This is the third year running that U.S. and Canadian companies plan to decrease such spending, a sure sign of transition to technologies such as SaaS and public cloud infrastructure that shift the infrastructure burden away from the in-house data center,” Computer Economics said.

The survey was completedy by 76 IT organizations in the United States and Canada and 97 from the rest of the world.