In 2008, most CIOs were forgiven for being unprepared to deal with the global recession, but if another recession unfolds in the next 12 to 18 months, no CIO will be forgiven for being unprepared a second time, according to Gartner.
In May 2010, investor doubts about the health of the global economy returned to the world’s capital markets with a vengeance.
The possibility of nations defaulting on repaying massive loans, high unemployment rates, depressed housing prices, limited access to consumer and business credit, a growing belief that a sustained economic recovery may not be possible this year, and an array of other factors have all combined to shake investor confidence to its core.
As these and other factors were unfolding, many economists were still maintaining that 2010 and beyond would be a period of modest recovery and growth.
Because so much uncertainty exists about the sustainability of the current recovery, Gartner recently stated that CIOs should confront such uncertainty with clear and decisive action and augment current near-term plans by preparing for a second recession.
“Just the potential for a second business downturn should be sufficient to compel CIOs to plan for another business downturn,” said Ken McGee, vice president of Gartner.
“However, most CIOs will not have a response strategy prepared if a second business downturn occurs.”
CIOs today are uniquely placed to tackle a second economic downturn, if they plan accordingly, McGee added.
“As questions, or even doubts, grow about the ability for economies to recover, CIOs in 2010 have one advantage over their predecessors,” he said.
For the first time in the history of the IT industry, more than 90 per cent of CIOs today possess extremely recent and practical experience dealing with a recession, he added.
“In light of this fact, we strongly urge these recession-hardened CIOs to leverage their recently acquired and economic battle-scarred experiences by proactively preparing their entire enterprises should another economic downturn occur within the next 12 to 18 months,” McGee said.
Gartner recommended that CIOs take a number of steps to ensure that their enterprises are best placed to weather any potential financial storms over the next 12 to 18 months, including enlisting C-level action now, focusing on both the current and next fiscal year as well as using zero-based budgeting for projects and existing applications.
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