It’s all about cost management and getting the right IT at the right price for enterprises these days. "Doing more with less" is pretty much the mantra for IT organizations world over. Today’s highly evolved and painfully competitive business environment requires companies to stay on top of their game all the time and respond dynamically to changing market conditions in an efficient yet "cost effective" manner.

The dual combination of fast growing organizational technology needs and moderate IT budgets are forcing CIOs to play Scrooge McDuck and manage IT costs tightly while still providing high-quality services to support the business needs.

According to recent Gartner findings, Indian IT budgets have been growing at roughly 16% year-on-year (YoY). Contrary to the global scenario which is at an average of 3.5%, this trend could easily tempt Indian IT leaders to get carried away and invest in technologies which may not be necessary and won’t add value to the overall well being of the business. Hence, Indian CIOs will need to exercise caution while shopping for IT.

According to Andrew Rowsell-Jones, vice president and research director at Gartner, "Cost management is a necessary management discipline for every CIO in today’s enterprise IT context. An efficient cost management strategy must take into account the business value of every technological investment. As important an asset as IT is to businesses, CIOs constantly need to devise means that optimize the yield on every system within their IT set up, failing which it could become a major liability."

Speaking further Jones said, "Complex IT and an immature intake of unnecessary technology that doesn’t add value to the overall business could easily lead to high IT costs. IT leaders and CIOs have to have an array of technologies to manage costs."

Use Portfolio Management Software For Cost Effectiveness
Talking about the possible tools that CIOs could employ to perform cost management Jones suggests the use of project/portfolio management software. Portfolio management software provide executives a 360 view of all their IT projects and enable them to spot redundancies, allocate resources appropriately and keep a tab on their progress.

By using portfolio management IT executives can clearly see where the money is spent, which projects are necessary and which aren't and what resources are required. Such tools can let you make better informed IT decisions.

Gartner also advises businesses to make use of new application delivery methodologies such as Software-as-a-Service (SaaS) and other web based services to cut IT costs. Jones believes that availing applications via Web turns out to be a more economical option in the long run as opposed to the conventional method of application delivery.

Jones also proposed that businesses should earmark a certain part of their IT budget to test new technologies and proof of concepts (POCs) that could bring them great business value in the future.

"BY leveraging these "transformational technologies" enterprises can future-proof their IT and transform their business by delivering greater value," opines Jones.

The key will be to asses the value these investments are going to bring. Here, one must not only look in terms of rupee value, but the deliverables these purchases offer. You have to be careful about how you articulate value.

Rajendra Chaudhary