Reducing IT costs sensibly

In times of economic worries, the IT budget quickly inflames emotions. Instead of blanket cuts, costs and services should be targeted strategically - this pays off both for IT and for the business units.

During periods of economic weakness, many IT organisations need to tighten their belts. However, experience has shown that hurried cost-cutting initiatives usually lead to unsatisfactory results. The reason for this is that they concentrate on obvious savings potentials without paying attention to the strategic orientation of IT and possible risks.

The goal of a sustainable cost reduction is to protect essential IT expenditure and to optimise the rest. To achieve this, IT organisations must recognise their own strengths and weaknesses. In addition to unit costs, drivers such as complexity, quality and volume are also important. These can only be coordinated within the corporate strategy and the requirements of the business units.

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