2 min
In the age of digital business, cost optimization should not be synonymous with “cost reduction”, or act retrospectively to a complicated economic situation like the present, if not serve as a preventive measure also includes the creation of digital opportunities capable of generating income.
Optimize costs, value strategy
The cut in costs or cost reduction in information technology is the first idea that comes to mind when a “cost optimization” arises. However, this is because often only arises when the situation calls for cutting the budget, thus limiting the ability to create opportunities for income generation just as likely that most needed. In contrast, when a strategy of this type is designed and implemented a priori of adverse situations, the business activity in question presents more efficient from an operational point of view, and the company is in better conditions to face a unstable landscape.
When the economic situation shows signs of stagnation or recession, “simply cut the IT budget and wait for the economic environment is more favorable to make digital investments” is not a valid option for organizations that want to remain competitive, he says the administrative vice president of Gartner, Barbara Gomolski.
Luckily, the last, which still persists, economic and financial crisis has enabled it to learn many IT leaders of large companies, but not all.
The challenge of 4%
Interestingly, although usually one of the first areas to which it intervenes in times of cutbacks, “IT costs represent only a small fraction, 4% of business costs.”
Cost optimization must go beyond mere cuts, including strategies that increase the initiative of the company. According to Kurt Potter, vice president and one of the leading analysts of Gartner, the cost optimization strategy must be comprehensive and include three types of activities:
- Reduce IT costs by maximizing the business value.
- Optimize the costs of activity, digitize and optimize processes to increase productivity.
- Increase and consolidate the presence in the digital age by digitizing data, information, processes, physical assets.
Since the beginning of the current recession, many IT leaders have not been oblivious to the need for cost optimization and have “squeezed” excess capacity of information technology and reduced its minimum low budgets. But the challenge now arises is that these IT leaders need to be proactive to help the rest of the organization to optimize and reduce costs, for example, extending the technology to other areas of the company in order to operate solutions so more efficient.
In conclusion, the increased use of information technology should focus on providing businesses work as efficiently as possible, rather than simply focusing on how to adjust the budget.
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