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The Ax Comes Down on Services (Slideshow)
Staff expenses, but not staff, also are prime targets for cost cutting. One of the arguments for using service firms is that they can be dropped relatively easily when cuts become necessary. That's what respondents plan to do. New projects also are likely to land on the chopping block should the economy suffer. Other targets for 2007 are the usual suspects--labor, upgrades, hardware and software. Storage and security are the two items CIOs can't afford to sacrifice. We drilled down to see what respondents meant by "staff and labor," and found it usually does not mean layoffs; other staff expenses are more likely to be slashed. Still, when CFOs tell CIOs to start tightening belts, especially at larger companies, it's the IT staff that bears the brunt: more work, fewer perks and more fear of layoffs.