SIM: IT Workers and CIOs Stay Put

The amount of data in our world has been exploding, and analyzing large data sets i.e.  big data—will become a key basis of competition, underpinning new waves of productivity growth, innovation, and consumer surplus. How are CIOs and senior IT managers adapting to meet these challenges?

The Society for Information Management (SIM) in their recent survey has revealed that both internal and external cloud development accounts for about 9% of all IT budgets. In addition, the offshore outsourcing trend continues to grow.

CIOs are always cautious with the planning of their annual IT budgets and are in search of efficiencies to drive down costs and increase productivity. Two of their best tools to achieve these objectives are an increasing use of cloud technologies and offshore outsourcing. These facts were revealed in the annual report of technology trends by the Society for Information Management.

According to the survey, IT staff turnover in IT departments averaged 5.2% this year, which is below the average rate of 5.8% measured over the past seven years.

According to McKinsey, eventually there will be a shortage of talent necessary for organizations to take advantage of big data. By 2018, the United States alone could face a shortage of 140,000 to 190,000 people with deep analytical skills as well as 1.5 million managers and analysts with the know-how to use the analysis of big data to make effective decisions. The key to filling these jobs will be through the enhancement if skill sets through additional job training.

SIM surveyed IT executives at 195 mid-to-large companies throughout the third quarter of 2012.

"People are finding it hard to find good jobs elsewhere so they're staying put," said Jerry Luftman, a SIM vice president and executive director of the Global Institute for IT Management.

Additionally he added, "the boomers can't retire" because of the poor economy's impact on retirement income and home values, he said.

The survey noted that 60% of IT departments increased salaries while 29% kept pay levels unchanged and salaries declined at 11% of IT departments.

The average CIO tenure reached nearly 6 years in 2012, up from an average of 4.5 years in prior years, the survey found.

"CIOs are staying around longer but still not quite as long as CEOs," said Luftman. CEOs have an average tenure of eight years, he said.

In 2012, nearly 48% of IT departments surveyed said their budgets increased from the prior year. The survey found that 46% of respondents expect budgets to increase next year, while 54% said their budgets will remain stable or be reduced.

"People are very concerned and proceeding extremely cautiously," said Luftman, citing the political and global economic outlooks. "Some budgets for IT are not going to be as aggressive as they might have been," he said.

The percent of IT departments outsourcing work has increased, the survey found.

In 2012, 36% of IT budgets, on average, were spent on outsourcing, up from an average of 28% last year.

Luftman said the increase in outsourcing is due in part to a reluctance by IT departments to hire permanent staff.

The percentage of IT budgets spent on outsourcing is expected to remain at 36% next year, but the share of outsourced work done offshore will rise from 5% to 7% next year.

The survey reported that 4% of IT budgets this year are being spent on external cloud and 5% on internal clouds.

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Bill has been a member of the technology and publishing industries for more than 25 years and brings extensive expertise to the roles of CEO, CIO, and Executive Editor. Most recently, Bill was COO and Co-Founder of CIOZone.com and the parent company PSN Inc. Previously, Bill held the position of CTO of both Wiseads New Media and About.com.

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