Who's Afraid Of A Little Recession?

CEOs are, according to <a href="http://www.pwc.com/extweb/ncpressrelease.nsf/docid/E8A3C6BBD4D4B3E4852573D7005318BF"> a study</a> by PricewaterhouseCoopers released at the World Economic Forum in Davos, Switzerland. Should CIOs be?

John Soat, Contributor

January 23, 2008

2 Min Read

CEOs are, according to a study by PricewaterhouseCoopers released at the World Economic Forum in Davos, Switzerland. Should CIOs be?Do you see slowing growth in your company's future? And what does that mean for your IT shop? Smaller budget? Less resources? (Translation: no new hires.) Less discretionary spending on new technology or new ways of doing things, like software as a service? More offshore outsourcing?

Or maybe the opposite is the case (though not the budget part, probably). Maybe this is the time to look for new ways to do things, like SaaS, that offer flexibility in both financing and use.

PricewaterhouseCoopers' 11th Annual Global CEO Survey indicated other concerns by top execs that have the ring of familiarity.

Compared to last year, possible economic downturn is the only risk factor to increase in concern among CEOs. All other risks to growth -- including energy supply, global climate change, and terrorism -- declined as business threats. Over-regulation and availability of talent were also top CEO concerns.

Those last two points are very familiar to most CIOs. For one thing, many tech execs complain bitterly about the time and resources spent in support of various regulations passed over the last several years, such as Sarbanes-Oxley. Unfortunately, one fallout of the credit crisis might be more regulation, which would mean more headaches for IT managers, certainly in the finance industry and possibly across the board. Regulation isn't something you can prepare for, but prudence might dictate a little closer scrutiny of all your processes.

Availability of IT talent is not a new concern for CIOs, but does an economic slowdown in the United States automatically translate to more interest in offshore outsourcing? Not necessarily, according to a new survey by Robert Half Technology, an IT staffing firm. For one thing, 94% of the 1,400 CIOs interviewed for the Robert Half survey say they do not currently outsource IT jobs offshore, and most (86%) indicate they expect to maintain the status quo.

In the near future, growth in offshore outsourcing is likely to come primarily from companies already outsourcing, not from those that are new to the practice: 43% of respondents from companies that currently engage in offshore outsourcing said they plan to increase their level of offshore outsourcing in the next two years, versus 13% who said they expect levels to decrease.

Are economic worries making you move things higher up or lower down on your priority list -- and what's higher and what's lower these days? How are you preparing for a possible recession?

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