The best thing that can happen to a CIO is for the IT budget to be cut completely. This would mean they would have...
to compete for funds in a meritocracy.
CFOs, the gorillas, stamp into the IT department and cut costs when the economy enters a downturn. But if CIOs had no budget and were allowed to compete for funds, they would have the perfect weapon to fend off the alpha males, according to business IT consultant and Financial Times columnist Ade McCormack, who founded Auridian.
Speaking at Gartner's recent outsourcing event in London, McCormack described how CIOs would be in a better position if they had to win funding forprojects.
"The trouble with IT is that when the market goes downhill, the CFO tends to cut the budget because he controls it," says McCormack.
He says if the users of technology control the budget, ie. the different departments, the IT budget wouldbe based on demand. "The CIO will have to kill what they eat, and as a result will be less subject to cost cutting."
He says the CIO will have to go out and win business by talking to departments. The IT department will create IT solutions to business needs and be paid for doing so.
"They will have to go out and charm department heads. The IT spend might actually go up in the downturn as a result," adds McCormack.
He says the next stage is for CIOs to go out and win business with other companies in their sector. "Some banks already do this and offer [non-competitive] back-office services to competitors."
"All of a sudden, the board does not see IT as a cost centre but a profit centre."
Ironically, it is CIOs whodo not like this model, not the CFOs, says McCormack.