Not Business As Usual

By Brian P. Watson  |  Posted 12-10-2008 Print Email

Not Business as Usual

Michael Gorecki, vice president of solutions architecture at AXA Equitable, a life insurance and annuity firm, says that despite playing in the financial sector, his France-based company is less skittish than most American financial firms. But that doesn't mean it's business as usual for him and his team.

So he's looking at how to get more money out of previous investments, focusing on return on assets (ROA) as opposed to return on investment (ROI). That mirrors a finding from our Future of IT survey: A little more than one in three IT executives cited improving ROI as a top management priority for the coming year. Service-oriented architecture figures heavily here, as Gorecki looks to weave together existing elements, rather than spending money for new ones. He's also looking to push into new endeavors, such as cloud computing.

While many experts hold the view that companies should spend on IT in tough times to drive competitive differentiation, Gorecki says that era has past. "To say that they should be spending more was at the end of the last century," he says. "Now, I want to put very exact slivers of money into specific areas to foster growth."

By making smart technology decisions, Gorecki adds, CIOs get an opportunity to match wits with their business colleagues in the C-suite. As businesses reassess their priorities, IT leaders have a chance to continue educating their business partners on how technology can positively affect their overall operations. "That is an education IT needs to deliver to C-level execs, because IT is changing more and faster than ever before," he says.

Tatum's Gingras has already seen a drastic change in the way non-IT executives view their company's technology strategy. That's due to two factors. First, he says, the "dream" of IT creating competitive advantage is finally being realized. It's not perfect, Gingras notes, but it's come a long way.

Businesses that have invested heavily in e-commerce and operational efficiencies can't just push them aside now in the face of economic uncertainty. Instead, the current climate pushes them to look at IT strategy as an opportunity for more cost savings--whether it's through virtualization, lowering energy consumption, increased telecommuting or another initiative.

Second, snap decisions can lead to mistakes. Technology has become so ingrained in corporate operations, Gingras says, that many executives fear doing something stupid. "Really, what can you turn off?" he asks. "There's a utility component of computing that companies can't do without."

Another bright spot from our Future of IT study is that the number of CIOs predicting a "radical restructuring" of IT departments in the next five years dropped to 47 percent from 54 percent in our 2007 report. That number is still relatively high, but it points out a growing sense of IT's stability within the larger enterprise.

That takes us back to Gingras' surprise discovery. The economic crisis may be providing an opportunity for introspection, but it's not creating a dangerous environment for IT. That's evidenced, too, by another finding in our survey: Only one in 10 respondents said it's likely that their IT department will be disbanded, leaving IT decisions to business managers.

So just when it looked grim for CIOs, a few mouth-watering opportunities have emerged: to exploit the crisis--and the subsequent strategic re-evaluations--to make smart technology decisions, flex their business acumen and educate business executives on technology's role in driving success. IT leaders should be doing all of the above in both good times and bad, but the current climate offers them a chance to do so when it truly matters. And that's something CIOs can't afford to pass up. --with analysis of research findings by Guy Currier

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