This example shows the use of IT strategic planning for cost reduction. The CIO realized that it is important that IT do the right things and do them effectively and efficiently. Therefore, significant cost reductions should strategically focus on the elimination of duplicative services rather than unilateral IT budget cuts. Toward that end, IT must fundamentally rethink how it operates.
To reduce IT Costs the plan lays out the following IT principles:
- Customer directed IT solutions
- Consistent Delivery of IT Solutions and Services
- Reuse of IT Solutions
Consequently, the focus is on engaging customers in decisions about what services are provided by the central IT organizations. It also necessitates a more transparent IT organization where customers will know service costs, constraints and other service issues. IT will also have to develop and follow standards that address technology and internal procedures.
These steps are critical for IT to achieve the desired cost savings and position it to provide better, continuously improving services.
