Getting the upside on the downturn

Getting the upside on the downturn

Summary: Don't smart over hard times — get smart and beat them

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TOPICS: Tech Industry
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There's nothing like a sharp sell-off on a Monday morning to get the blood flowing — and there's a lot of blood on the floor of the financial markets today. That's the only liquidity anyone can see.

The first signs of the true effects of the massive readjustment in the global capital system are coming through. Last week, Marks and Spencer said that it would be cutting its capital expenditure from a projected maximum of £900m this year to around £700m, with a maximum of £400m likely in 2009.

This week, Accenture announced a three to four percent cut in its UK staff — largely, we believe, in system integration and implementation, precisely the areas where capex reductions will hit first.

Expect more of the same; any financial page has as much bad news and grim prognostication as you can stand to read. Whatever happens next, there will be a major reduction in spend across the board: for now at least, the money's gone away.

In the words of Freewheelin' Franklin, IT will get you through times of no money better than money will get you through times of no IT. If you need better performance or new functionality, you can spend money — or you can get clever with what you have. In the absence of the former, we recommend the latter.

Getting smarter is the new capex. Hone the IT skills that will most immediately and effectively improve your company's bottom line, and find ways to do more with less. Most of the IT we use has the promise of far more efficiency and flexibility than it currently delivers, and that's a reservoir of opportunity. Tap into that, and you'll be indispensable.

Smart companies — and smart people — not only survive bad times but use them as a stimulus to evolve. If you can continue to deliver effective innovation during a downturn, imagine what you can do when the brakes come off and your competition has already fallen behind.

Don't just sit there. Evolve.

Topic: Tech Industry

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  • buy and goodbye

    I agree that the wise choice is to fine tune and optimize what you have at the moment. Let's not forget that for many, it's a time for cleaning up. Sometimes it would make more sense to hang on to devalued shares and property, but people will go on selling even at rock bottom prices.
    All that is fine if you have the sense to buy up what you can when the climate is bleak, the profits later will be huge. A very familiar pattern methinks. Although I think the banks are in for it this time, partial nationlisation was on the cards last time I looked.
    roger andre