Mixed bag for IT services spending in 2009, Forrester says

By Denise Dubie, Network World |  Hardware

Enterprise IT leaders continue to keep tight controls on budgets, cutting their spending on IT contractors and consultants, according to a new Forrester Research report.

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"Unlike the last recession in 2001 to 2002, when outsourcing and offshoring benefitted from strong anticyclical growth, the picture looks much more mixed this time in terms of spending plans," according to the report, "The State of Enterprise IT Services: 2009."  

Forrester polled more than 900 IT executives and technology decision-makers in Canada, France, Germany, the United Kingdom and the United States to learn how they plan to invest budget dollars in IT services.

Among the specific findings:

* 30% of those surveyed said they plan to increase spending on systems integration and projects, though systems integration services are being cut by 26% of those polled.

* 41% reported that they intend to reduce spending on IT contractors.

* Offshore services will experience the lowest overall decrease, with 12% of respondents reducing investments in that area. Fifty-five percent said they intended to keep spending on offshore services the same.

"The majority of firms are already in some form of offshoring project in 2009, with only 6% stating that they will not commence one in the next 12 months -- compared with 37% in 2008," the report reads.

Pilot offshore projects showed considerable interest as well. Forty-five percent of firms plan to start pilots in the next 12 months. Twenty percent have committed to working with offshore providers, up from 14% in 2008.

"And 16% of firms use offshore services whenever possible, up from 10% of respondents in 2008," according to Forrester.

The lowest level of planned activity falls to desktop management and mainframe services, Forrester reports, but the IT leaders polled showed "the highest interest in/consideration of virtual hosting services" at 18%, with managed mobility services being of interest to 17% of those surveyed.

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