Top-performing organizations in the private and public sectors, on average, spend a greater proportion of their IT budgets on digital initiatives (33%) than government organizations (21%), according to a global survey of CIOs by Gartner, Inc. (www.gartner.com). Looking forward to 2018, top-performing organizations anticipate spending 43% of their IT budgets on digitalization, compared with 28% for government CIOs, says the research group.
Gartner’s 2017 CIO Agenda survey includes the views of 2,598 CIOs from 93 countries, representing US$9.4 trillion in revenue or public sector budgets and $292 billion in IT spending, including 377 government CIOs in 38 countries. Government respondents are segmented into national or federal, state or province (regional) and local jurisdictions, to identify trends specific to each tier. For the purposes of the survey, respondents were also categorized as top, typical and trailing performers in digitalization.
Rick Howard, research vice president at Gartner, said that 2016 proved to be a watershed year in which frustration with the status quo of government was widely expressed by citizens at the voting booth and in the streets, accompanied by low levels of confidence and trust about the performance of public institutions.
“This has to be addressed head on,” he added. “Government CIOs in 2017 have an urgent obligation to look beyond their own organizations and benchmark themselves against top-performing peers within the public sector and from other service industries. They must commit to pursuing actions that result in immediate and measurable improvements that citizens recognize and appreciate.”
Government CIOs as a group anticipate a 1.44% average increase in their IT budgets, compared with an average 2.2% increase across all industries. Local government CIOs fare better, averaging 3.5% growth, which is still more than 1% less on average than IT budget growth among top-performing organizations overall (4.6 %).
The data is directionally consistent with Gartner’s benchmark analytics, which indicate that average IT spending for state and local governments in 2016 represented 4% of operating expenses, up from 3.6% in 2015. For national and international government organizations, average IT spending as a percentage of operating expenses in 2016 was 9.4%, up from 8.6% in 2015.
“Whatever the financial outlook may be, government CIOs who aspire to join the group of top performers must justify growth in the IT budget by clearly connecting all investments to lowering the business costs of government and improving the performance of government programs,” Howard said.