Warning: failure-driven IT layoffs ahead

Even under normal circumstances, IT failures impose a substantial drain on corporate resources. During this period of economic trouble and scarce resources, however, many organizations will show less tolerance for failure, making layoffs likely.

Warning: failure-driven IT layoffs ahead

Even under normal circumstances, IT failures impose a substantial drain on corporate resources. During this period of economic trouble and scarce resources, however, many organizations will show less tolerance for failure, making layoffs likely.

CIO blogger, Peter Birley, describes the downturn equation from a senior management perspective (emphasis added):

The position of the business is key and the CIO needs to be close to what is happening so that they can feel any pain and be able to react early.... Early intervention might even remove later difficulties or loss of the wrong projects. IT is often viewed as a money drain and there is not a great perception or realisation of the cost of keeping it running....CIO’s should also be wary that they don’t do something they may regret later.

Peter wisely advocates organizations adopt a balanced, levelheaded approach to examining IT costs. This means companies should prioritize their business initiatives, leaving the solid ones in place and dumping the others. That's good news for high-performing people working in IT.

Although some IT workers may be safe, eWeek reports, the picture is hardly rosy:

The reason is that companies still rely heavily on technology to operate on a day-to-day basis.... Unfortunately, this offers little protection for software engineers and coders whose positions will continue to be outsourced domestically and internationally to the least costly providers," said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

Job seekers in the IT industry may also have a difficult time going into the new year, as companies scrap plans for adding or updating technology. Companies will not start expanding their IT departments until the economy rebounds.

What does this mean for folks working on IT projects? If your project is important to the company and provides real strategic or business value, then your job is likely safe. In times of downturn, companies avoid cutting strategic projects.

On the other hand, if your project provides marginal benefit to the company, then your job may be in jeopardy. To help determine whether you're at risk, ask yourself five hard questions:

  1. How important is my project to the company?
  2. Does the organization see my project as success or failure?
  3. Do I play a critical role on the project?
  4. Are my skills easily replaced or outsourced?
  5. If my project is troubled, how easily can I move to one that's successful?

Projects the organization views as pointless and wasteful are prime candidates for termination, especially in today's economy. If your project is late and over-budget, and particularly if it's also based on a shaky business proposition, then perhaps you'd better polish up the old resume.

[Photo source: iStockphoto]

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