Chief Information Officers (CIOs) are walking new ground as they seek to improve competitive business advantages in an economic downturn - balancing the pressure to reduce capital expenditure against unprecedented opportunities to increase productivity and stay on the forefront of innovation.
In today's global economy, IT effectiveness and business innovation are two sides of the same coin. As the strategic importance of advanced technology and best-practices management comes into sharp focus, and the global economy positions itself for a recovery, executives are looking to eliminate wasteful spending and evaluate all IT investments by the productivity improvement they will deliver to the business - not just by how much they cost.
But what does this mean on a day-to-day basis? What can CIOs do to help ensure that they invest wisely for sustainability and growth?
According Gartner, in 2009, resource constraints were the biggest factor limiting organisational growth for medium-sized businesses. As the economy recovers, generating demand, organisations are looking for ways to invest for strategic returns. The challenge is that most medium businesses feel that they are already investing a great deal in IT, and in many cases, they are not wrong. For medium-sized organisations with technology-dependent business processes, evolution is virtually impossible when 80 per cent of their IT resources are committed to legacy systems that do little more than keep the lights on and maintain the status quo - leaving just 20 per cent to invest in strategic development for growth. To succeed in the face of today's economic pressures, executives must change the balance of their IT spending.
Smart CIOs are advocating a fresh approach to enterprise spending - rather than spending more, what if they could do more with what they are already spending? Instead of focusing simply on cost-cutting measures, they are developing new methods to evaluate the business returns on their IT investment and the most effective ways to allocate the IT budget following from that analysis.
What could your organisation do if you retained all of your talent while gaining the opportunity to refocus it on strategic initiatives? Enterprise efficiency is the key to answering this question.
Enterprise efficiency is based on three simple steps that every medium-sized business can implement: standardisation, simplification and automation.
Standardisation is the first step toward achieving these goals. As database workloads outpace aging hardware with demands for higher compute density, memory capacity, and input-output scalability, industry-standard architectures can go a long way toward lowering the cost of doing business and freeing up IT resources that can be redirected to innovation.
Simplification is the second key to unlocking efficiency. It isn't unusual for a medium-sized business to run hundreds of different applications. Consolidating onto a smaller number of applications and platforms leads to dramatic savings on maintenance and support.
Automation is the last step toward redirecting IT budgets from maintenance to innovation. By reducing labour costs - which account for a significant proportion of IT spending - automation allows enterprises to work within tight budgets to advance business agility while also facilitating short-term contracts, improving flexibility and scalability, and increasing productivity with self-service IT models.
Anothai Wettayakorn is managing director of Dell Corporation (Thailand), with responsibility for Indochina.