President's Corner

There have been some interesting items in the news this week. The one that grabbed everyone's attention, naturally, was the declaration by an economist at Barclays Bank that the global recession ended in April. The journalist whose report I was listening to also interviewed a strategist at Charles Schwab, who expressed full agreement, citing the behavior of the stock market over the last few weeks as one leading indicator. Other news reports mention the significant reduction in the US housing inventory and Citigroup’s plan for $1 billion of mortgage refinancing.

It will take similar reports and indicators to fully restore confidence and loosen both consumer and business purse strings. And because employment is always a lagging indicator, there will continue to be a degree of uncertainty for some months to come.

Back to that “purse strings” thing - another item that caught my eye this week was in CIO Insight’s electronic news feed. It was a report on a survey conducted by The Information Systems Audit Control Association (ISACA). The results from 500 respondents painted an interesting picture.

While 16% of respondents said they were making “sweeping cuts” in IT spending in 2009, 14% said IT spending would remain the same and 25% said they plan to increase their IT investments this year. That’s almost 40% of organizations whose IT spending is constant or increasing over 2008 levels.

Some other interesting results from that survey highlighted just how focused organizations are on demonstrating value from IT spending.

- 66% of organizations claim that the perceived value of IT varies across different departments in their organization

- 29% of organizations measure the value of IT investments

- 51% of organizations have a formal system or framework to prioritize IT investments based on value to the   organization

So let’s do a little recursive programming here - back to that “recession” thing.

When economic times are challenging, we as individuals go into protection and survival mode.  We examine our spending, focus on the essentials, and stash our cash as a hedge against unknowns and uncertainties.  Likewise businesses, governments, and other organizations.

But there’s a fundamental difference I’ve observed and one that’s worth examining. When businesses focus on the essentials, one of the first things to go is staff education. When individuals think about survival techniques, honing skills or developing new ones is usually considered an essential.

So why the difference? Does it come back to that “value” thing? Do we need to do a better job of demonstrating the value of on-going IT education to our organizations? It’s worth some serious thought.

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