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IT Investments in the Current Economic Situation - Cost Cutting Boom
Even though there is a down-right cost cutting boom going on, according to Forrester CIO’s are still investing in innovation. Investment targets were surveyed by CIO Magazine, and I’d like to highlight some of them:
- Collaboration and knowledge management
- Business intelligence and business process management
- Virtualization of servers, storage and desktop pc:s
Collaboration technologies improve workforce efficiency and provide cost savings. These were highly praised by Cisco CIO and Accenture CIO in a webcast provided by CIO Magazine. If people use collaborative technologies instead of travelling frequently to internal meetings , the cost savings can be significant. Great benefits can also be gained from increased frequency of internal collaboration. This demands open culture that supports collaboration but also the technologies as an enabling factor.
Business intelligence and business process management help in business decision-making and improving workforce efficiency. Therefore, these interest CFO’s, CEO’s, and business line directors the most. As an example, being able to understand the transaction cost of e.g., selling a product, delivering the product, or developing a product provides invaluable insight into what to improve.
Virtualization is a major factor in driving down internal IT costs. While the current adoption rate is highest on server and storage virtualization, desktops are being virtualized at a growing pace. I expect this to be one of the main areas where IT is seeking cost reductions. Lowering hardware costs is, of course, not the only virtue of virtualization. IT can deliver new services faster and maintain services with lower costs as the whole virtualized environments are easier to move on new hardware.
The next two years will show how the current economic turbulence will eventually affect IT. I hope that IT investments are not cut that severely as they can bring bigger savings to the whole organization. Just remember to invest in correct places and cut costs from standard operations.
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