Cost-cutting can hit any
department,andIToftentops the
list. IT leaders areunderhuge pressureto demonstrate that they can run an efficient, effective
business unit.The silver lining isthatthis presents them with a clear chance to prove
themselves as commercial leaders,writes Steve
O'Connor, vice-president of IT transformation at BMC
Software.
By taking on an advisory role forlong-term efficiency and staff
management, ITbecomes key to the business getting ahead in the
recession.
Inefficient IT threatens staff
Gartner highlighted recently that on average 80% of IT's effort
is focused on "keeping the lights on"rather than driving business
growth. Staff end up firefighting and managing routine processes
rather than delivering business value. This brings increased
scrutiny on the IT department, often resulting in a knee-jerk
reaction from the CFO to slash costs by reducing headcount.
In my experience, this is a risky approach to cost reduction, as
the wrong people are oftencut. The CFO does not have sight of where
the critical business roles sit and where routine processes that
merely "keep the lights on"can be streamlined. This is why you must
step up to control the "slash and hack"approach and demonstrate how
you can deliver long-term IT efficiency.
Largely driven by this need, there is increasing interest in an
ERP approach to IT. It gives visibility of where investment is
needed, and where the fat can be cut -from a financial, resource,
vendors and compliance perspective. We can dub this emerging trend
service resource planning(SRP).
Cutthe fat, not the muscle
This might seem like an easy task to undertake, but it is
important not to underestimate the challenge of identifying those
IT roles to cut within such a complicated environment. The
heightened level of visibility and control across IT functions that
SRP offers is absolutely vital.
In the shortterm it enables immediate, accurate assessment of
where the critical roles sit and where the CFO can consolidate
without impact to the business. In the longer term, SRP gives you a
stronger platform to justify investment that ensures IT remains
efficient. For example, you may be able to demonstrate where
automation tools can be strategically deployed to streamline
routine processes, allowing staff to focus on business-critical
tasks, thus ring-fencing them from further cutbacks.
Improveyour stake in the balance sheet
Use the data SRP provides to discuss the balance between
short-term cost reduction and ongoing investment with your
leadership team. Through this data you can assess the long-term
business needs and plan toward them. By actively engaging with the
board you can build trust, educating them on your role as a
business advisor who can not only make recommendations for
strategic cost reduction, but also on where investment can ensure
long-term efficiency.
This level of onward planning and insight is out of reach for
the CFO. As such, SRP opens the door for you to directly control
the balance sheet, secure longer-term investment and efficiency,
and safeguard your top-performing people from slash and hack
cost-cutting.