|
|
|
|
8 - 10 April 2002
|
Florence, Italy
|
|
|
Getting a Grip on Costs
|
|
David Flint, a Gartner Research Director | | |
Monday 8 April 2002
The biggest question facing many attendees at Gartner Symposium/ITxpo in Florence, is how to save money in IT without damaging the business.
David Flint, a Gartner research director, says that managers have become sceptical about IT. They are demanding proof of the benefits it brings and are more frequently making big cuts in IT spending these days. Since there is no "killer" cost saving action available, said Flint, the chief information officer (CIO) should address both new projects and operational costs and, he says, each needs a specific technique.
Flint explained that it is easy to save money by simply cutting projects, but such action will damage the future of the business. Therefore, CIOs should review their project portfolio critically and categorise projects according to their payback period and purpose. Projects that deliver big business savings quickly and competency-building projects that create immediate benefits should be tackled first; projects without a good business case should be scrapped.
"Many CIOs have bought IT capacity, whether hardware, bandwidth or software licences, that they will never use," said Flint. "They should eliminate the waste and then engage business managers in a constructive debate about the levels of service they need and are willing to pay for."
Flint added that the CIOs job is to articulate the service options and their costs then persuade business managers to assess the level of each service option. This frequently leads to savings, and where it does not, it will still improve IS's business credibility.
But Flint warned that CIOs should not suppose their departments are any less responsible to economic realities than other managers. "The good CIO will not want to be exempt, but will recognise the need for IS to contribute to cost containment this year in order to build credibility for the coming upturn" concluded Flint.
By Andrew Spender, Gartner
|
|
|
|
|
|
