November 20, 2006

US IT Spending Benchmarks For 2006

How To Turn The CIO's Bane Into An Effective Tool For IT Budgeting

by Andrew Bartels

with Ellen Daley, Laurie M. Orlov, Heidi Lo

Executive Summary (This is a document excerpt)

Every year, CIOs and their finance people get prepared for the following question from their CEOs: "How does our IT spending compare with our competitors?" To help them respond, Forrester is providing 2005 and 2006 IT spending benchmarks, including IT spending as a percentage of revenues by industry and size of company, IT spending per employee, and IT staff as a percentage of total staff. Our recommended IT spending benchmark, though, is spending to maintain and operate the IT organization, systems, and equipment (MOOSE) as a percentage of revenues. Our 2006 estimates for this benchmark metric are included in this report. We also recommend that CIOs should measure and track IT MOOSE over time and against business results, not simply against peer companies.

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