Recession fears hit IT budgets

The state of the economy and its potential impact on IT budgets will be the key challenge for IT chiefs this year along with the ongoing war for tech talent, according to silicon.com's exclusive CIO Agenda 2008 survey.

The credit crunch, uncertainty in the world's financial markets and fears of a recession all add up to even more pressure on already squeezed tech budgets as organisations tighten their belts.

Half of the 20 CIO Agenda respondents cited declining IT budgets as their main challenge this year.

One CIO respondent said: "The tighter economic climate will drive further pressures on IT budgets. Business demands will continue to want greater agility but quality deliverables and the same or lower cost."

Alastair Behenna, CIO at Harvey Nash, said "enhancing business performance with a declining budget" will be his main challenge for 2008.

Other CIOs cited "maintaining IT budgets in a recession", "more for less" and "demonstrating value for money" as the big issues they face in the next 12 months.

Getting IT's voice heard in the boardroom also remains a priority. One respondent said about the board: "They understand it in their heads but not in their gut."

As with last year's CIO Agenda, the tech skills shortage remains a big problem for employers.

Two-thirds of CIO Agenda respondents this year said they are having difficulty recruiting staff with the right IT skills.

The most in-demand skills are project managers and "business-savvy technologists".

Specific tech skills in short supply vary widely and include .Net developers, MCSE/CNE or CNA web developers, VMWare and legacy Novell expertise.

There is also demand for skills around SAP Basis - the range of middleware programs and tools from the ERP giant that enable its modules to be interoperable across operating systems and databases. Basis is also a development environment for R/3 (SAP's flagship product) applications.

Despite that, more than half (59 per cent) of CIOs said they are more optimistic about the year ahead than they were last year.