CIOs must assess Euro crisis impact: Gartner

With extreme uncertainty plaguing all enterprises operating in the eurozone, CIOs must act immediately to safeguard their enterprises from the risks of government/bank default, euro break-up, counterparty bankruptcy and employee/customer distress.

Gartner has stressed on four challenges with respect to Euro criris and these are: market volatility, captial costs, human capital management, and risk management.

Most enterprises and their IT departments are burdened with significant numbers of bureaucratic processes and latent decision-making mechanisms. Today's market conditions require business and government executives to radically restructure their business practices.

The costs of and access to capital across Europe will likely continue to worsen until there is a significant redress in structural imbalances between countries and organizations. Unwillingness or inability to write off debt and restructure public- and private-sector balance sheets is a substantial barrier to market efficiency. Lines of credit will likely become uncertain or removed, forcing corporations to reduce inventory.

Millions of people are out of work in Europe. Formal government austerity packages and informal corporate restrictions on salaries, benefits and working conditions, combined with high costs of living, are stressing workforces. This situation is compounded by retirement funding shortfalls, extensions in the working age and loss of benefits.

From an IT standpoint, operational risk is heightened via issues such as changes in contractual obligations and business continuity. Added to this is the continued increase in regulatory compliance initiatives across industries, which exacerbate the pressure on audit and risk management assessments and workflows.

''Uniquely positioned within their enterprises, CIOs are at the fulcrum of business and technology, and they are the only executives with sufficient visibility and potential capability to address the challenges posed by today's eurozone crisis,'' said David Furlonger, vice president and Gartner Fellow.