With IT spending up significantly this year compared to previous years, IT managers and CIOs are wondering just how much (spending) is too much. How do you measure your return on investment? How do you balance your IT budget? What factors do you take into consideration?

The SearchCIO 200 is all about companies that excel in this area. The accompanying tables will show you the top enterprises that are getting the IT budget balance right, and getting the most for their dollar. These companies are leveraging IT investments to get the best business results.

You may assume that this isn't really an issue for large companies. True, large companies tend to have bigger IT budgets, but that doesn't necessarily mean the money is spent wisely. The 200 companies on the following charts spend anywhere from $1,019 to $39,945 on IT per employee. To make the SearchCIO 200 list, a company must deliver a higher business value than its competitors as a function of IT spending.

Once again, we partnered with researcher Alinean Inc. to measure this performance. The metric (explained in detail here) begins with Economic Value Added (EVA), a highly regarded measure of an organization's true profitability. The EVA is then divided by IT spending estimates drawn from industry averages and research conducted by research firm IDC and Alinean.

The results? A list of the leaders who achieve the highest Return on IT, or ROIT. ROIT is Alinean's term used to describe the profitability and shareholder value that a company achieves from its IT investments. Click here for the Alinean's ROIT methodology. The research was conducted in 2005, based on IT spending data for 2004.

The following pages show 200 companies who achieved the best ROIT. The companies are ranked within 10 industries. Many of the companies on the list were on last year's list as well. However, there are some new companies this year such as Amazon.com, Inc. Reynolds American, Inc., PG&E Corp., and Equifax, Inc.

The bottom line: With IT leaders having been so cautious in past years with IT spending, decision makers have become smarter in how they spend their IT dollars. And with overall IT budget increases in 2004 and more increases expected for 2005 and beyond, IT leaders are proactively investing their dollars in IT while remaining cautious.

What is driving their ROIT? Outsourcing? Offshoring? Better staff or management?

Take a look at the leaders in your industry and compare their budgets, company size, etc. with yours. The leaders are at the top of each industry, but do keep in mind that they are all leaders within their industry.

We'll be profiling some of these ROIT achievers in the coming months, noting their secrets to ROIT success. You can model your IT organization after these companies' success stories. After all, experience goes a long way.

Take a careful look at the following tables and the accompanying methodology. Once you've done so, take a moment to calculate your own ROIT using Alinean's exclusive formula, detailed here.

For a look at the small to midmarket industry, view SearchSMB.com's SMB 50 list.

With a new look at your company's IT spending and investments, you'll be able to make wiser, more calculated choices and hopefully maintain even bigger IT budgets in the future.

Karen Guglielmo,
Editor, SearchCIO.com
CIO Decisions Media Group, TechTarget