A recent CIO survey by the Harvey Nash group has found that CIOs are increasingly expressing concern over the skills gap in their IT teams — between key skills they view as important and the capability of their team members to deliver on those skills.

The survey found a large percentage of participants who reported that their organizations use no formal competency-career model to match employee skills to needed functions, and training seems to be similarly ad hoc, with organizations relying by far on on-the-job training.”

The CIO survey also found that the IT budgets are again growing worldwide. It says that IT spending limited by recession has led to pent up demand for operational improvement that’s now being released. In addition, a significant portion of IT budgets in the U.S.A. has been devoted in recent years to complying with new regulatory requirements like Sarbanes-Oxley. With the initial controls assessment behind them, many respondents indicated that their companies are once again feeling confident that they can afford to invest more in technology.

The report also finds that security ranks as the top concern for U.S. companies in contrast to those in the U.K.

Nearly all respondents reported some outsourcing of IT functions, and most expected it to increase. Nevertheless, many IT leaders are developing strong opinions as to what tasks can be successfully outsourced, suggesting that the case for outsourcing varies by industry, and should be considered carefully. A limited number of respondents reported direct experience with offshoring, and all of those admitted some disappointment with initial results, especially with regard to quality.

Nevertheless, those currently offshoring expect it to continue and even increase.