Most UK CIOs expect their budgets to rise this year but many IT Departments will struggle to support their organisation’s growth, according to a report released today (28th July 2010) by Xantus.

The report, 'Supporting Business: The CIO Challenge', shows more than 70 per cent of CIOs in large companies with a turnover £250m - £1bn believe their departmental budgets will rise over the next 12 months, with more than half expecting an increase greater than 10 per cent.

But despite the anticipated boost in IT investment, less than half (48 per cent) of those surveyed think their departments are fully prepared to support growth. The financial services sector and smaller organisations rate skills as the priority in enabling IT to support the aims of their organisation as a whole, while public sector and manufacturing are more focused on technology.

Obstacle and solution to growth...

The biggest obstacle for growth appears to be legacy hardware and systems (41 per cent), although for many CIOs (43 per cent) the application of new technology, such as cloud computing will be key to overcoming these issues.

Overall, IT leaders are broadly positive about the future (56 per cent), although cost cutting still remains a priority for many (40 per cent).

Steve Watmough, CEO of Xantus, commented: "The past 18 months have seen immense pressure on IT budgets. Although our research shows that CIOs believe this pressure is easing, corporate and IT leaders, supported by a well-resourced IT department, still need to drive their businesses efficiently - bearing in mind that a low growth environment is likely to continue for some time yet in the UK and beyond."

For the report, Xantus also assembled a CIO Panel* from its client base of FTSE100 companies and government departments. Mike Bell, CIO of Kingfisher, a member of the Xantus’ CIO Panel, told researchers: "There’s no money to be made by holding money in the bank. Getting more from less was, and remains, the focus; putting IT functions under pressure to identify innovative ways to improve service without increasing costs."

*Xantus’ CIO Panel included: Rob Fraser, IT Director of Sainsbury's; David Lister, Group CIO of National Grid; Peter Federico, Group IT Director of British Midland International (bmi); Pete Stafford, Technology Services Director of Nationwide Building Society; and Mike Bell, CIO of Kingfisher.