Overall IT Worker Confidence Index Drops Sharply from the Second Quarter; Signs of Optimism Still Remain

The IT Employee Confidence Index dropped 7.6 points to 50.6 in the third quarter of 2010, according to a recent survey commissioned by Technisource, the technology services division of SFN Group, Inc. The survey, conducted by Harris Interactive, shows a quick reversal in IT worker confidence in the strength of the economy -- with optimism around this question dropping 18 percentage points from the second quarter of 2010. Coupled with this decrease, 56 percent of technology workers believe fewer jobs are available (versus 49 percent in the previous quarter).

Results from the IT Employment Report:

-- A scant 20 percent of technology workers believe the economy is getting stronger (compared to 38 percent in the second quarter). Nearly half (47 percent) of workers believing the economy is staying the same.

-- More than half of the respondents believe there are fewer jobs available (56 percent). At the same time, 43 percent of IT workers are confident in their ability to find a new job.

-- Thirty-eight percent of technology workers are likely to search for job opportunities in the next 12 months, up a single percentage point from the second quarter of 2010 and the highest since the fourth quarter of 2009.

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IT Spending to Return to Pre-Recession Levels According to Corporate Executive Board

The Corporate Executive Board, a research and advisory services company, released new data that indicates a 3.3 percent increase in IT operational budgets for 2011, following two years of zero growth. This finding is based on the benchmarking of projected IT spending, staffing and project data of CIOs and IT managers at 133 Fortune 1,000 Companies and collectively represents an IT spend of approximately $70 billion. Based on the projections, leading corporations are cautiously preparing for a return to growth.

CEB's research, conducted by its Information Technology practice, also revealed that nearly 45 percent of the IT project budget within the surveyed companies will be allocated to deploying business intelligence and collaboration tools, or to enabling the customer interface. In fact, 10 percent more business intelligence and collaboration projects are expected to be undertaken in 2011 vs. 2010. This spending will come at the direct expense of process automation projects, which will decrease to 41 percent of the total projected budget.

Additional key findings of CEB's benchmarking research include:

-- Broad-based Growth Among Companies: Encouragingly, the trend of increasing IT operational budgets is broad-based, as two-thirds of CIOs will increase expenditures in 2011. This compares starkly with forecasts of last year, when 75 percent of CIOs expected operating budgets to remain flat or decline.

-- Integrated IT Services are Fast Becoming a Reality: CIOs plan to integrate their traditionally siloed infrastructure and applications groups or merge IT into a cross-functional enterprise services organization. By 2012, 20 percent of organizations will be integrated into a multi-functional shared services organization, and an additional thirty-five percent of organizations will have integrated IT services.

-- IT Capital Budgets Will Remain Flat in 2011: Two-thirds of the total IT budget will be continue to be consumed by "keep-the-lights-on" maintenance or costs associated with regulatory compliance activities. IT capital budgets will remain flat in 2011, at 0.6 percent of revenue, mirroring the lack of growth IT organizations saw in the last three years. 

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CIOs Are Change Agents for a More Collaborative, Virtual Workplace: Survey by Economist Intelligence Unit

Cognizant, a provider of consulting, technology, and business process outsourcing services, announced the results of a research report, “Next-Generation CIOs: Change Agents for the Global Virtual Workplace.” The report reveals the CIO’s role in restructuring how work is done throughout the organization. Among the more than 400 survey respondents, mostly CIO, CEO, vice president, and director-level, those who are moving toward more virtual, collaborative teams are benefitting from increased innovation, more effective talent recruitment and retention, and higher productivity. One in six said their companies are already seeing these results, and another one-fifth expect to garner benefits within a year.

The CIO should spearhead the transformation to a more virtualized workplace, according to 45 percent of respondents. Only CEOs ranked higher, with 47 percent, indicating the CIO is a strategic enabler who, alongside the CEO, can align IT capabilities with business needs.

Key findings include:

-- Virtual team structures are fostering more productive relationships with internal and external partners.

-- Organizations that have embraced virtual teams benefit from increased innovation and competitiveness, but often lack methods to measure the quantitative impact on the bottom line.

-- CIOs have a unique enterprise-wide perspective and are familiar with the people, tools, technologies, and techniques needed to create a corporate culture of virtual teams. 

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2010 Cost of Waiting Survey and Report Uncovers the True Economic Cost of Waiting for Consumers and Businesses

Being forced to wait for hours at home for a service or delivery appointment is a frustrating experience for today's busy consumer, and it is also an expensive one. TOA Technologies conducted the second annual Cost of Waiting Survey and Report to shed new light on the economic impact of waiting for in-home appointments. The report found 69% of American adults have waited for utilities, cable/satellite TV, Internet, retail home deliveries and other services in the past year. Those that wait typically do so about four times per year, for an astonishing average wait of almost four and a half hours per appointment - costing consumers about $752 in lost time annually.

Businesses are also losing money and hurting their reputations by making people wait. The margin of time companies have to satisfy their customers is slim. Customer satisfaction drops from 60% when on time to 19% when service or delivery companies are just 15 minutes late. In addition, 48% of waiting Americans contacted customer service to complain about their experience.

The Cost of Waiting Survey also found that:

-- 21% of respondents switched companies as a direct result of waiting for their appointment.

-- 28% of Americans waiting for an appointment or delivery gave up and left their home in frustration.

-- Businesses lose $719 annually for each person who cancels or switches service providers (based on respondent estimates).

-- 48% of waiting Americans contacted customer service to complain about their experience. 

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Worldwide Enterprise IT Spending to Reach $2.5 Trillion in 2011

Worldwide enterprise IT spending is forecast to reach $2.5 trillion in 2011, a 3.1 percent increase from 2010 spending of $2.4 trillion, according to Gartner, Inc. 2010 enterprise IT spending is on track to total $2.4 trillion, a 2.4 percent increase from 2009. Over the next five years, enterprise IT spending will represent a period of timid and at times lackluster growth with spending totaling $2.8 trillion in 2014.

In addition, Gartner discussed four broad trends that will support change in IT, and in the economy, the next 10 years.

1. Cloud

2. Business impact of social computing

3. Context Aware Computing

4. Pattern Based Strategy

Cloud computing is a style of computing where scalable and elastic IT-related capabilities are provided “as a service” to external customers using Internet technologies. It constitutes the basis of a discontinuity that amounts to a new opportunity to shape the relationship between those who use IT services and those who sell them.

The second major trend is the business impact of social computing. Not simply more platforms such as Facebook or Twitter, the real impact will come as the underlying ethos, culture and attitudes which shape social computing and have driven growth to date, pervade the enterprise and blur the boundaries between personal and professional activities.

The third major trend impacting IT leaders is Context Aware Computing. The proliferation and availability of wireless technologies – coupled with an explosion of super intelligent devices – notebooks, tablets and smartphones -- in the hands of consumers– linked to cost effective compute and communication capabilities in all physical products – has created a new Internet

The last trend is Pattern-Based Strategy. A Pattern-Based Strategy provides a framework to proactively seek patterns from traditional and non-traditional sources, model their impact, and adapt according to the needs of the pattern.

This builds on pattern-based technologies such as social network analysis, context aware technologies and predictive analytic tools. It will allow IT leaders to seek-out patterns amidst the burgeoning information sources and model future possibilities.

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Research Shows Increase in Average Starting Salaries for IT Professionals

Information technology (IT) professionals in the United States can expect starting salaries to increase an average of 3.4 percent in 2011, according to the just-released Robert Half Technology Salary Guide 2011. Larger increases in base compensation are expected in high-demand segments such as applications and web development, data security and enterprise resource planning (ERP).

According to the Salary Guide, web designers will see the greatest starting salary gains of any job classification in 2011, with base compensation expected to rise 5.5 percent, to between $50,750 and $83,000 annually.

Other key findings from the Robert Half Technology Salary Guide 2011 include:

-- Base compensation for ERP technical developers – who tailor ERP software for their organizations – is projected to increase 5.2 percent next year, to a range of $79,250 to $109,500.

-- Average starting salaries for business intelligence analysts will rise 5 percent, to the range of $82,500 to $116,250 annually.

-- Data modelers can expect base compensation in the range of $80,750 to $111,250, a gain of 4.5 percent over 2010.

-- Network managers will see average starting salaries rise 4.3 percent, to the range of $79,250 to $109,500 per year.

-- Base compensation for IT auditors will increase 4.2 percent, with starting salaries of $77,750 to $108,000 annually, on average.

Industries forecasting particularly strong demand for IT professionals in 2011 include business services, transportation and healthcare. 

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85% of Tech Leaders Optimistic on Economic Recovery, but Companies Project Employment to Remain Flat

On the heels of one of the most severe economic downturns of the last century, and amid a continued sluggish global economy, the DLA Piper Technology Leaders Forecast Survey found that industry leaders are confident of continued economic recovery and project moderately increased sales revenues for tech companies over the next six- to 12 months.

The survey, measuring the attitudes and perspectives of top executives within the technology industry, reveals that close to 85 percent of technology and venture capital executives believe the global economy is on a sustained path of economic recovery. This is a notable increase in confidence over the survey DLA Piper commissioned just six months ago, when 69 percent of technology leaders projected that an economic recovery was at hand.

Tech Companies Expect Sales Growth, But No Increases in Employment and R&D

Survey respondents indicated high levels of confidence for their own respective business plans and financial forecasts during the next six- to 12 months. Nearly 72 percent of respondents expect their firms to experience sales growth during that time period; more than 82 percent forecasted business demand will rise. Start-ups and mid-sized technology companies were slightly more optimistic about their sales growth prospects than were larger technology companies.

Still, in a clear illustration of the caution with which companies are proceeding in the current economic environment, 43 percent of companies reported they expect to keep staffing levels flat. The outlook is gloomier among large tech companies. For those companies with over $1 billion in annual revenue, nearly 60 percent expect flat or decreasing employment over the next six- to 12 months.

Weak IPO Market Permanently Altering Model for Tech Start-Ups

Respondents also widely agreed that the weakness in the IPO market will continue notwithstanding some improvement in 2010, with nearly 72 percent of respondents indicating that they no longer view an IPO as an optimal exit strategy. As a result, more than 59 percent of these executives believe the traditional venture capital model has been “permanently altered” – and expect both fewer venture capital firms and fewer funded technology companies in the future.

Government Impact on Tech Sector

There was a mixed reaction to the expected debate and vote on the Bush-era tax cuts that are set to expire at the end of the year. A majority of the business executives responding to the survey (56 percent) believe that an expiration of the tax cuts would result in reduced investments in start-up tech companies and venture capital funds. However, 30 percent of tech executives believe the increased government revenues generated with the resulting tax increase would help reduce deficits and improve general economic confidence.

Tech leaders were more bullish on government investment and involvement in the CleanTech sector, with nearly 84 percent of respondents favoring tax incentives and other active involvement in that sector. CleanTech and Cloud Computing were seen as the tech industry’s two most promising growth opportunities according to a ranking that appears in the survey.

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Bad data costing US businesses $700 billion a year

Bad data is costing US businesses hundreds of billions of dollars a year and is affecting their ability to ride out the tough economic climate, according to Ovum.

In a new report the independent technology analyst claims that poor quality data is now costing US businesses an estimated $700 billion a year due to the inefficiency it causes and through lost customers, sales and revenue.

Bad data includes incorrect and outdated values, missing data and inconsistent formats. Costs mount as it wastes time and leads to poor targeting of resources and flawed pricing strategies.

While there are many data quality tools available to help businesses reduce the effect on their bottom line, choosing the right one is half the battle.

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Social Media is Changing Attraction & Retention of Talent, Yet 76 Percent of Companies Have No Formal Social Media Strategy

Social media is changing the way people find jobs, but according to the latest Emerging Workforce Study by SFN Group, most companies are out of step. In fact, less than one-fourth have a formal social media strategy in place, and of those, only one-third say they've had success.

While successful adoption of social media requires a radical mindset change, the SFN study found many companies continue to apply conventional thinking to attracting, cultivating and retaining workers -- a strategy that may fall short in today's digital world.

Conventional Misfire #1: Attracting Talent Is Most Successful through Traditional Means

According to the study, only four percent of HR executives use social networking to recruit. For many, attracting workers remains a sterile, one-size-fits-all approach, regardless of an onslaught of social media that now offers boundless opportunities to target specific candidate groups and tap into markets which might otherwise have been inaccessible.

Conventional Misfire #2: Providing a Paycheck Alone Ensures an Engaged Workforce

The Emerging Workforce Study found that for 75 percent of workers, their job means more than just a way to earn a living. A full 88 percent want to think of new and creative ways to do things, with most workers naming growth potential as the top reason to stay beyond pay and benefits. One of the most effective venues to engage workers is social media, yet of the 44 percent of businesses using it, only 20 percent use it to motivate existing employees.

Conventional Misfire #3: Social Media Has Little to Do with Retaining Workers

Less than 20 percent of companies leverage social media to retain employees, according to the study. This is not surprising, when only 23 percent of HR executives said they are concerned about retention. However, utilizing social media to reinforce a company's commitment to its mission can deliver tremendous dividends in employee loyalty.

The study found that workers who feel their employer has a clear corporate mission -- and follows through on it -- are nearly twice as likely to stick around, compared to those who work for companies without a clear mission.

Arguably, a compelling reason behind the growth of social media is it allows people to be heard. Giving workers an outlet to speak their minds can dramatically improve employee retention.

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