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Article
 Getting
creative with IT Budgets
By
Rod Travers
Senior Vice President, Technology
With economic
conditions improving, CIOs and IT leaders are welcoming a potential
upswing in IT spending. The challenge for many will be to properly
allocate spending between infrastructure projects and overdue
applications renewals. And no matter what the budget trends are,
customers are expecting better service on the web, fellow employees
are asking for on-target functionality, and CEOs are demanding
tangible business benefits from IT. Satisfying a broad constituency is
never easy and what works for one company may not work for another.
But here are some suggestions that may help your company strike a
balance with its IT budget:
 | Curtail habitual
upgrades, especially at the desktop. Does every desktop in your
organization need the latest version of Office? We are already at
the saturation point for feature sets. Skip an upgrade cycle. |
| Consider using
offshore support for selected projects. This one’s not for everyone,
but “routine” projects such as data conversion and legacy system
maintenance are often candidates for offshore outsourcing and the
cost savings can be substantial. This allows your internal staff to
focus on high-touch, high-impact projects that require firsthand
internal knowledge and experience. |
| Conduct an
integrated IT/business process review. This is a formal process,
usually involving a facilitated workshop, to objectively identify
and implement streamlining opportunities and associated savings. For
example, remember that clunky old reports system that churns out
dozens of virtual green bar reports every week? You may find that no
one uses those reports any more — they use the data mart instead.
And how about that departmental data-capture tool that is now
redundant but has hung around anyway? Or perhaps that
paper-intensive exceptions process in the new business unit — the
one with the standalone document tracking system? Perhaps if that
exception process was redesigned and the right automation was
applied, the effort would pay for itself and save dollars for both
the IT and the new-business departments. |
| Identify untapped
functionality in your existing systems. This is another benefit of
an IT/business process review. The most fertile ground for this is
CRM systems. These systems often have far more functionality than
most companies use, and some of that functionality is just what
users are seeking. But the users aren’t aware it’s there. |
| Consider using open
source systems. I am not a big fan of open source because it has
pitfalls such as training, support and reliability that can make it
seem much the same as commercial software. Yet there are times when
it may make sense for some companies. For example, you can put up a
new web server for almost no cost by using Linux, Apache and a
recycled desktop computer. Not what you’d use for mission-critical
transaction processing, but it would certainly work well for an
internal web server or a “development box” used for testing. |
| Buy day-old bread.
By this I mean consider buying used hardware or equipment that is
“last month’s model.” Who cares whether your Cisco switch came new
from Cisco or used from an internet auction? And brand new equipment
can sometimes be purchased at fire-sale prices when a vendor
introduces newer models. Laptops are a good example of this. |
These are just a few ideas. There are, of course, many more being put
into practice every day. The key to any of these is to understand the
consequences in concrete terms. If you think it’s a good idea,
dig deeper so that you know it is. Use disciplined analysis,
including tools such as staffing models and benchmarks, to validate
your ideas. Partner with the business unit leaders to identify cost
avoidance and savings opportunities. Most importantly, go after these
things proactively. Maybe you can hold the line on your budget while
delivering even more from IT.
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