Perspectives & Strategy

Baseline magazine has just published its “5 Keys to Reducing IT Costs”. Since I have been discussing Cost Effective IT on this site I thought it important to take note and comment.

Baseline’s 5 keys:

□ Architecture
□ Planning
□ Vendor Management
□ Relationship Management
□ Demand Management

Architecture is important in building an effective IT department. Few in IT will argue with this. The biggest challenge for the CIO is to sell this role to the business management as for many business managers it is seen as only providing an IT benefit. In some corporations this is the first IT role cut in a recession, yet it is the one person who holds the key to the corporate infrastructure. The role has an impact beyond IT as they are the custodians of policies, standards and compliance.

No one will argue the importance of Planning especially as it is important to manage the investment priorities. ROI is firmly back on the agenda as the business must know what it is getting for every dollar spent. ROI demands are becoming shorter (Management is now demanding a positive return in less than a year).

It is important that all projects follow a process, are correctly planned, and the plan adhered to. The management of all projects must be prioritised by business demand.

Effective Vendor Management is essential in keeping a tight reign on the costs of the IT department. The CIO needs to sharpen his negotiation skills in order to drive costs down. Vendors are very aware that this is a competitive market, in fact this is where not being reliant on one single vendor can assist the IT Manager. Push-back on increasing license costs, deals can be struck, this is the feedback I have had from vendors. Look at those unused licenses and trim them.

Building strong relationships through the business community has always been an important factor in the CIO’s role. Now more than ever Business and IT need to be in sync. I believe that the role of the CIO is changing and is now one that encompasses overall business change, not just the technological implementation.

Demand Management ensures that the right level in internal and external staff are available. Tracking future demand is vital in a tight economy. According to Baseline what it takes to get the job done is the right tools to predict future supply and demand.

I do think the Baseline steps are just the starting point. Now more than ever before the business of IT demands ‘No Surprises’ and an effective relationship with business.

(Reprinted from IT Toolbox)