IT guys - An Important news for you
On Wall Street, the prices of shares in technology companies have been bouncing around even more than most other industry sectors. Tech stocks were battered on Tuesday, driving down the overall market.
The picture is mixed and uncertain. But based on the early readings before quarterly earnings begin in earnest soon. IBM, surrounded by rumours of weakness, announced its third-quarter results in advance last week, beating analysts’ estimates. Oracle, too, says it is holding up fine. But SAP, the enterprise software maker, and Rackable Systems, which supplies server computers to big Web companies and many smaller businesses, recently lowered guidance for the quarter.
Gartner this week presented its information technology spending projections for 2009, and it sees the souring economy taking a toll. Its worst-case projection (increasingly likely, it seems) places worldwide growth in technology spending at 2.3 per cent for 2009, down from 5.8 per cent previously. Stronger Asian markets like China are propping up the overall numbers. In North America, Gartner sees spending growth at half a per cent in 2009, down from 5.3 per cent previously.
In an interview, Peter Sondergaard, Gartner’s senior vice president for global research, explained that information technology was now so integral a part of business operations that spending was no longer going to be much higher or lower than the broad economy. “This isn’t like the 2000 to 2002 period, when much of the world lost confidence in IT,” he said.
Horizons will shorten, and projects that can wait likely will. “CIOs have to learn to think like CFOs,” he explained, using the common shorthand for chief information officers and chief financial officers. At a conference this week, Mr. Sondergaard offered a “top 10” list for squeezing more out of tight budget dollars. In the spirit of the new austerity, we’ll just give you the top five (the bottom five don’t add much): 1. Reduce headcount and freeze hiring. 2. Curtail data center expansions and “virtualise” servers, putting more software loads on fewer machines. 3. Renegotiate with technology and services suppliers. 4. Consolidate functions and systems to achieve greater economies of scale. 5. Outsource commodity services. It’s enough to warm any CFO’s heart.
The picture is mixed and uncertain. But based on the early readings before quarterly earnings begin in earnest soon. IBM, surrounded by rumours of weakness, announced its third-quarter results in advance last week, beating analysts’ estimates. Oracle, too, says it is holding up fine. But SAP, the enterprise software maker, and Rackable Systems, which supplies server computers to big Web companies and many smaller businesses, recently lowered guidance for the quarter.
Gartner this week presented its information technology spending projections for 2009, and it sees the souring economy taking a toll. Its worst-case projection (increasingly likely, it seems) places worldwide growth in technology spending at 2.3 per cent for 2009, down from 5.8 per cent previously. Stronger Asian markets like China are propping up the overall numbers. In North America, Gartner sees spending growth at half a per cent in 2009, down from 5.3 per cent previously.
In an interview, Peter Sondergaard, Gartner’s senior vice president for global research, explained that information technology was now so integral a part of business operations that spending was no longer going to be much higher or lower than the broad economy. “This isn’t like the 2000 to 2002 period, when much of the world lost confidence in IT,” he said.
Horizons will shorten, and projects that can wait likely will. “CIOs have to learn to think like CFOs,” he explained, using the common shorthand for chief information officers and chief financial officers. At a conference this week, Mr. Sondergaard offered a “top 10” list for squeezing more out of tight budget dollars. In the spirit of the new austerity, we’ll just give you the top five (the bottom five don’t add much): 1. Reduce headcount and freeze hiring. 2. Curtail data center expansions and “virtualise” servers, putting more software loads on fewer machines. 3. Renegotiate with technology and services suppliers. 4. Consolidate functions and systems to achieve greater economies of scale. 5. Outsource commodity services. It’s enough to warm any CFO’s heart.
posted by Gopalakrishnan at
9:56 PM
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