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Priorities shift for ASEAN CIOs

Anuradha Shukla | Feb. 7, 2014
Technology spending in ASEAN to grow slowly in 2014.

Priorities are shifting for the Association of Southeast Asian Nations (ASEAN), according to a newly released report by Forrester.

The research firm recently surveyed 615 CIOs and technology decision-makers in Indonesia, Malaysia, the Philippines, and Singapore. Findings of the report authored by Tim Sheedy indicate that technology spending in ASEAN will grow slowly in 2014.

Although more than half of the region's CIOs plan to increase their spending, tech spending growth in ASEAN will stay around 7% in 2014. This percentage is below the 8% growth levels of 2011 and 2012.

This less than desired performance is attributed to rising concerns about inflation that have made a significant impact on currencies in the region. Fluctuation in the rate of currencies often leads to an increase in the price of tech products leading to a decrease in sale of these products.

Tech budgets have decreased this year and this has driven CIOs to cut down expenditure on traditionally major IT functions and instead spending more on improving technology capabilities.

Changing tech landscape

Forrester predicts a changing tech landscape in the coming year and expects ongoing operations to remain as the largest component of technology spending.

Organisations in ASEAN will spend 40% of their technology budgets on ongoing operations and maintenance this year. The percentage of this spend was 44% in 2013.

28% of tech spending in 2014 will go in expanding capacity to support business growth and 32% of tech spending will be on new IT initiatives and projects.

CIOs in Indonesia (34%) and Malaysia (36%) will spend on overall tech outlays. 30 % of CIOs in Philippines and 26% in Singapore will spend on overall tech outlays.

CIOs in the Philippines and Singapore will spend 33% and 32%, respectively, of total tech outlays on replacing capacity.

 

 

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