Project Portfolio Management

Battle for the IT Budget: Operation VS Experimentation

What’s the big fuss about IT adopting new technologies? Can’t those CIOs and CTOs just get with the program of “keeping the lights on” like they’ve always done? According to an article by Conner Forrest on ZDNet, the old norm of IT as maintainer of business operations is under threat of revolution.

Bucking the Old Regime

The forces that suppress IT innovation are primarily linked to the prioritization of capital toward fundamental business operations. In other words, staying alive comes first; growing comes second. This doesn’t sound like business logic. For instance, the business end might instead say that growing is staying alive. As technology becomes more central to growth each year, the IT unit can no longer survive as a mere supplement or enabler. The challenge of reducing operating costs must be overtaken by the urgency of technological competition.

Tools of Budgetary Liberation

The value of investing in new technology, besides the obvious increase in power, speed and so on, is the potential to lower operational expenses through the management and revenue models of modern software tools such as cloud computing and software-as-a-service (SaaS). Additionally, managed services and outsourcing offer another level to maintain, or further lower, operating costs.

One way to turn the tables on the IT budget lock is to rationalize technology investments that will not just pay for themselves but ultimately pay down operating costs in the long term. SaaS and Cloud-based software in general seem to accomplish this feat rather well, with data center growth moving off-site and making legacy costs look unfavorable by comparison. Another solution: outsourcing (which technically includes SaaS). And if you thought all cost cutting ideas were exhausted, think about the possibilities of Cloud-based hardware like Chromebooks.

The New Power

Once these revolutionary tech investments bring down the old IT budget spend, the next question will be a matter of spending power versus saving power. Does the new surplus return to the business, get reinvested as additional technology, or is it shared between the two?

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