IT Spend is one of the most discussed topics among corporates and IT organizations today. It had been a fashion to boast IT spend figures before the IT bubble burst when it was presented in a manner to show the speed and attitude of organizations. Not anymore. The speed, attitude, one-upmanship is replaced with accountability. Corporations today expect an IT organization to be accountable to the business.
Hence, two key questions posing challenges to top IT executives are:
- What should be the optimal level of IT spending for the organization?
- How can IT be a transformation agent to deliver maximum value against investments?
Sometimes the discussion is around how optimized an organization’s IT Spend is; on other occasions the IT spend is compared and benchmarked to understand the degree to which an organization is IT savvy. However everyone is grappling with one question - “How much IT is right”. The answer can be as simple as comparing it with available benchmarks or it could be as difficult as computing it bottoms up. Unfortunately, there is no single and simple answer.
What in your opinion could be the right answer for this and how important it is for CIO to estimate what IT Spend should be communicate and targetted for the organization?
What in your opinion could be the right answer for this and how important it is for CIO to estimate what IT Spend should be communicate and targetted for the organization?
1 comment:
IT cost is traditionally made upfront where the expected benefits come later, so measurement of IT intensity should ideally be after the break- even point, where revenue figure is on ascending track .Considering today we expect real time status , the challange is how to justify the cost made upfront.
Ideally CIO's should explore the feasibility of IT spent linked to outcome ( SaaS). However the reliability,criticality and confidentiality of the proposition should be assessed.
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