How to Plot Your 2009 IT StrategyBy John Parkinson | Posted 01-06-2009
This isn't the first time I've been faced with the prospect of managing through a recession, but it's never fun. The definitions of "rational" and "business case" morph into something quite different when times get hard.
Nevertheless, there are ways to cope with the inevitable desire to pull back investments and either slow down or cancel projects. Here are some ideas that have worked for me in the past and that I will deploy once again.
First, tough economic times are not an excuse to go after your technology vendors. I want my key vendors to continue working with me when things turn up, so I need to keep them engaged now. I am, however, going to expect some degree of shared sacrifice.
Second, I will focus on hanging on to my best people. If I take care of them now, they'll remember that when things improve and there are more opportunities outside our company. I probably won't be able to do much for them financially, but I can invest in recognition programs and, even more important, in training programs to build skills and interest for the future.
Third, I'm also going to focus on the things we do in IT that help the business defend revenue and maintain margins. I like to think that we always do this, but there can be many distractions when things are going well. So we will increase the level of scrutiny on every project and focus even harder than usual on the cost levers that we have to work with. In particular, we will continue to focus on standardization and simplification of our infrastructure, virtualization and consolidation of our technology environments.
Fourth, I'm going to look at our core spend in several areas to see what I can eliminate, reduce or defer without hurting operational performance or stacking up major problems for later. I'm not going to defer things that we should deal with right away, even if the business case isn't that great right now. It will still be much more expensive to fix such things later. Accumulating technical debt and deferred maintenance never makes sense.
We saw signs of the recession coming and have been rebalancing our portfolio of projects in preparation for it. As a result, there hasn't been a need for major revisions in our plans--just a lot of opportunities for tuning.
We've been on a steady diet of operational cost improvements for some time. This gives us some discretion to continue investing in areas where there are good longer-term prospects. And we can always justify projects that pay for themselves quickly: In 2009, that's going to mean payback within less than 12 months. I'm going to challenge some of my vendor partners to live by their assertions that they can save me money. We will pay them based solely on what they actually manage to save us, not just on promises.
As I look out at 2009, the biggest challenge I see is maintaining morale. Quite a number of our associates and customers have never seen a major recession and are at a loss to know what to expect or do. Keeping them engaged and active in innovation and appropriate levels of risk-taking will put significant demands on the management and leadership groups here.
All in all, it's going to be an interesting year. In addition to the tough economic environment and the challenges facing business and IT, our country is getting a new president.