When recessionary winds blow, it's not good enough to huddle down
and wait for better weather, argues Colin Beveridge. There are
deals to be struck, strategies to be shaped and, perhaps most
importantly, skills to be sharpened.
The good news is that the IT downturn looks as if it's coming to an
end. The bad news is that it is becoming a full-blown recession.
The chill winds that have been blowing our way since Easter have
now become positively arctic. Next year's budget needs cutting now
and that means we need to shift our focus slightly from a
technology bias to pure management.
Some kind soul pointed out to me the other day that I was old
enough to remember the last recession and asked me how should an IT
department prepare itself for the challenge ahead. If only life was
that simple. Ten years ago our computer operations were fairly
autonomous and less susceptible to the actions of others. In many
ways we were better positioned then to control our regimes than we
are now. Why is that? Because technology has become so pervasive in
recent years, that's why.
Twenty years ago, or even ten years ago, most organisations had
reasonable contingency plans for manual processing if their
computer systems failed. Their business could at least continue,
although impaired. Nowadays, however, almost every aspect of our
lives depends on the instant availability of technology. Technology
that we have to manage and continue to provide, regardless of the
prevailing economic climate.
Our businesses no longer have the order books, typewriters and
carbon-paper tucked away for the occasional system failure. Turning
off the machine is no longer an option to control costs, even in a
recession. So we
 | | "We need to play to our strengths
and make sure that IT is a well-regarded function, high enough up
the food chain to avoid predatory accountants!" | | | | | |
| | Colin Beveridge | | |
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are the victims of our own success. We have all helped by making
sure that information technology is firmly established as a
commercial necessity - a necessity that always has to be paid
for.
For the past four or five years we have been able to cite Y2K and
e-business as strong justifications for our IT budgets and our
paymasters have generally acceded to our recommendations. Now it
seems, it's payback time. We need to cut our costs, perhaps sharply
and quickly, without impacting on the success of our businesses.
This will be a challenge that will affect most of us, throughout
the IT department.
Given the likely scenario of budget cuts, we probably need a few
personal and corporate tactics for survival. Let's look at some of
the aspects that might confront us.
First, it's bad news for contractors. Big-ticket items are the
first under the microscope in any recession. Contractors are also
relatively easy to get rid of quickly. Enjoy your disguised
unemployment, guys. It will be a buyers' market for the foreseeable
future so you will have to be more flexible on rates and location
if you want to protect yourself from the worst effects of the
recession.
As it's a buyers' market, now is also a good time to screw down
suppliers for new deals. If you can't make savings now, you never
will. But a word of caution - it's quite acceptable to get a good
deal and to make your vendors sweat a little blood to get your
custom; but make sure that you are not cutting your own nose off to
spite your face.
Things will get better eventually and people will always remember
how you treated them when the going got rough. Loyalty is a
currency that is rapidly being devalued and you should always keep
your eye on the future, as well as the present.
The same principles apply to your own staff and organisation.
Damage limitation is the order of the day so discretionary spending
will inevitably be the first for the knife.
The external training budget is obviously a soft target,
particularly in a poor jobs market. Staff are less likely to think
about moving on at the moment, even if you do have to postpone
long-promised courses. Please note that I said postpone, not
cancel. Skills training and personal development are important
factors in sustaining an effective department so budget cuts in
this area need special attention. You need to assess the overall
impact, not just the bottom line.
Our unfilled vacancies are probably going to remain unfilled for
the time being. The pressures on headcount are creating a downward
trend so it is time to make the best use of our existing resources.
Let's hope that the recruitment freeze does not progress to the
next phase - actual reductions. It is a sad fact of life that the
best people are always the first to leave once you get into a
redundancy situation. Now is the time for us all to check our
succession planning and to identify any key posts that may have to
be put on our internal "at risk" register.
In the meantime, we also need to make sure that our departmental
profile is properly maintained within the company. We must make
sure that everyone knows we are doing a good job, doing our bit to
make the business a success. We need to play to our strengths and
make sure that IT is a well-regarded function, high enough up the
food chain to avoid predatory accountants!
So much for the management issues. What about personal strategies?
Well, we could all keep our heads down and hope that the problems
go away, keep quiet and hope that nobody notices us. Batten down
the hatches, guys, we're in for a stormy ride. Fair enough, this is
one approach - and it will work for many people - if you like
painting yourself into corners.
I believe, though, that action is often better than inaction. In
20-or-so years, I have only met one ITer who was genuinely
independently wealthy. The rest of us have mortgages and need to
work to pay our way. That is why we should all use this recession
as an opportunity for upgrading our skill-sets.
How? By using the technology at our disposal, that's how. Most of
us have access to the Web, either at work or at home. The Internet
has a wealth of freely available skills resources. Now is the time
to mine them, for our own benefit and for our companies.
I have seen the future and it is Web-based, pervasive computing.
The Web is not just for ponytails and air-heads. The new world of
the future will definitely need some of the old-world transaction
processing and client-server savvy people who understand the
principles of resilience and commitment when applied to database
transaction processing.
Now is a good time to enhance those proven skills with new
techniques and tools. Most of these resources are available free,
if you know where to look. Legitimately available - I am not
advocating dodgy software cracks or wares!
Finally, another possible silver lining to the gathering cloud of
recession is the opportunity for creativity. It's amazing what you
can do, when you have to. Necessity truly is the mother of
invention and, these days, information technology is very often the
midwife so bring me some clean towels, plenty of hot water and an
Oracle DBA.
What's your plan to make it through the rain?
Are you
starting to feel the chill? Do you have any recession-beating
tricks up your
sleeve?>
Let us know with an e-mail.Colin Beveridge is an interim executive who has held
top-level roles in IT strategy, development, services and support.
He has held posts at a number of leading corporations, including
Shell, British Petroleum, ICI, DHL and Powergen.