Taking Control of IT Costs

"IT-related projects tend to have long-term implications which are not easily reversed compared to many non-IT-related projects."

"The choice may be between smashing the existing organization now and hastening disaster, or playing for time and hoping the new technology will go away or that someone will work out how to deal with it in time."

"In seven steps, a manager can get a good initial estimate of the efficiency with which his IT support is run."

"The trick in managing IT costs is to manage the future, not the present."

"Consider two aspects of your IT costs. Are they fixed or variable costs? And are the costs hard or easy to predict?"

"In a fixed-cost related IT allocation principle, IT costs are allocated on the basis of how much of some other, fixed, cost is apportioned."

"To maximize the increase in IT efficiency, a firm needs to optimize its mix of short-term v. long-term initiatives."

"Within the IT department itself, a tactical cost reduction initiative can be left to individual managers but it is usually more effective to identify a small task force to oversee the activity."

"Aside from a competent and experienced manager, the workers on the team should be trained in accounting techniques, and have some experience of IT cost management."

"Benchmarks or KPIs measure the efficiency or effectiveness of some aspect of an organization's IT."

"There are three main practical issues in selecting, implementing and managing KPIs. These are: data availability and cost, balance versus directed action, organizational and behavioral evolution."

"The particular methodology used to implement an IT strategy is less important than first, having a good understanding of the strategic IT issues faced by your organization, and secondly, having good teamwork."