As a CIO, you always have to juggle budgets. This is certainly true when the economy takes a dip. Fortunately, you can usually reallocate budgets and make savings where necessary. At the same time, make sure you stick to your long-term strategy. This way, IT will always be a springboard for new growth.
As a CIO, you mostly work on projects – some big and some small – and you can usually schedule them flexibly. If there is a downturn in the economy, you can adjust the planning. In this way, you can already take advantage of the flexibility inherent in IT.
Make an inventory of all IT costs
Panic measures are never a good idea. So take a strategic approach to your cost management. First of all, make an inventory of all IT costs to decide what you can save on. Stopping new recruitment temporarily, for example, or using certain hardware a bit longer than originally planned. It may be relatively easy to remove barely used or end-of-life software from your wish list.
Analyse the business impact of savings
When doing such a cost analysis it is important to consider more than just the numbers. For every possible saving, ask yourself to what extent the decision would be reversible and what the impact on the business would be. This gives you a clear overview of what you can simply drop and the projects you can postpone. Create a timeline with priorities that you assess systematically, for example every month.
Move faster towards a digital transformation
The next question then is what these IT priorities should be. Even in times of crisis, the IT department should not be guided by the idea of imposing savings on itself. In order to survive as a company after the crisis and moreover to get ahead of competitors, you must continue to invest in strategic projects. For example, you can use the budget that you free up by making savings to speed up the roll-out of your digital transformation. So check out what IT resources and knowledge are needed.
Opt for flexibility
This may be the time after all to move towards the cloud, if it hasn't already happened. In any case, a cloud model gives you much more flexibility with your IT budget because instead of investing capital in IT to allow for growth you pay operational costs every month for what you actually use. The same goes for IT staff: if you occasionally need extra people, then it is financially much more beneficial to hire external experts than to recruit them yourself. Did you make an investment in your own IT infrastructure just before the crisis? Then you can release that capital through a sale & lease back or a sale & rent back agreement. This means you sell your hardware and software and immediately lease it again.
Keep investing in innovation
By making the right strategic decisions, you ensure that your company not only survives a challenging period but also emerges as a winner. So above all, keep investing in the automation of business processes, teleworking and new technologies that increase efficiency. After all, your job as a CIO is to use technology in all circumstances as a driver of innovation and business growth.