Bulk of IT spend tipping away from chief information officers

Responsibility for IT budgets is slipping away from chief information officers as business units increase their involvement in technology strategy and purchasing decisions.

IT departments are now directly responsible for less than 60 per cent of enterprise IT spending, down from 74 per cent, according to a survey of more than 1400 IT and business decisions makers in the Asia-Pacific region.

"Business leaders focused on business outcomes and innovation directly controlled 33 per cent of enterprise IT spending in 2012," the Forrester report says. "The influence of business leaders on IT spending at organisations across Asia-Pacific is climbing to levels never before seen."

The erosion of IT's powerbase has been going on ever since marketing departments began taking an interest in the hosting of their websites. Since then, business units have been increasingly involved in the purchase of customer relationship management and other software, and now cloud computing resources.

The Forrester report notes that many CIOs seemed to be oblivious to the trend. "Many of the Asia-Pacific CIOs we speak with do not see or accept the growing influence of the business, but the signs are clear."

It also identifies a large increase in the percentage of IT spending influenced by business leaders, in addition to that directly controlled. On average only 32 per cent of the budget channelled through IT is spent without significant business input, down from 49 per cent in 2010.

"The top reason that business leaders are spending more on technology is because they believe that it's too important for the business not to be involved."

Forrester advises CIOs to gain visibility into all the IT spending within their organisations and "create guardrails within which their business leaders can spend on IT more responsibly".

Full story: smh.com.au/it-pro