Balance the cost of IT with the need for resources

It's a vicious cycle. The more we do in IT, the more that's expected.
Written by Michael Sisco, Contributor

It's a vicious cycle. The more we do in IT, the more that's expected. At the same time, we're asked to spend less while user needs and demand for IT services increase. Is there a way to balance it all? It's difficult, but there are a few things you can do that will help you deal with this challenge. Consider the following.

Appreciate the problem
Since the dot.com debacle and the economy dip, pressure on earnings have become a key issue for most companies. Companies have been scrambling to make their revenue and earnings forecasts in order to remain viable concerns. This is especially true of midsize and small companies.

The net effect to many IT organizations has been a squeeze in technology funding for the past few years. The economy appears to be picking up, and there are signs of some increased spending, but the squeeze still exists for many IT shops.

During tough times, IT has the opportunity to shine. No other department in the company has the leverage that IT has to help the company save money. We can literally affect almost any company department in a positive sense by helping them cut costs or improve productivity through technology initiatives. Tackle some of these hidden gems with cost-effective technology initiatives and save the company money; you may find that the view of IT's role in the company will change considerably.

Tips in managing cost vs. need
There are a few management basics that will help you manage the challenges placed on you in an environment where everyone wants more for less.

  • Quantify your capabilities—If you don't quantify the IT services you can provide, you leave yourself wide open for interpretation of those services. When that happens, your clients and technology users will typically assume you can do more than you actually can.
  • Quantify your capacity—Likewise, you need to have a crystal-clear idea as to how much service your organization can provide the company in all the technology disciplines you support. In addition, communicating the level of responsiveness that your IT operation can perform becomes important.
For example, I determine my programming support capacity fairly quickly. Assuming my programming staff is predominately focused on programming enhancements and supporting our company's business applications, I assign a "programming productivity" factor of 100 to 120 hours a month that a programmer should be productive. The number is higher when we have a more stable environment and each programmer is able to focus more time to programming tasks.

If I have 10 programmers in my organization, my output capacity will be between 1,000 and 1,200 hours per month. Certain months may fluctuate quite a bit, but over the course of four to six months, the trends will average out.

If I know my capacity, I can forecast how much of our programming backlog can be tackled per month. When we establish a sound track record of estimating programming enhancements and delivering on our capacity level, our clients are better able to prioritize and are much more of a "partner" that works with us as opposed to just wanting us to do more.

Manage according to capacity

By establishing what you can do and quantifying your capacity, you position yourself to manage to your capacity instead of leaving yourself open to any and all requests. When capability and capacity are defined, you have a much better opportunity of getting your technology users to prioritize your work.

You have a certain capacity with your IT resources. Think of a five-pound sack. That sack will hold five pounds of sugar, maybe a little more, but it will not hold 10 pounds. You can be flexible on what your IT resources work on, but not very flexible on how much they can do. You have to work within your capacity constraints.

By articulating what you can do and how much you can do, you actually empower your users to help you determine the best projects to work on in order for them to meet their needs and priorities. One rule of thumb is that there will usually be more need than you have capacity, so make the effort to quantify what you can do and how much of it you can deliver with confidence.

Manage expectations and avoid the "new project trap"
When I was a young IT manager, I wanted to please my senior management team very much, just as most of us do. The challenge I had was that I didn't know how to manage their expectations, so I would fall into the "new project trap." This trap isn't intentional, but it's nonetheless sitting out there waiting for the unsuspecting if we allow it to be.

It works this way: We develop our plans to support our company and focus our employees on important issues in that support effort. Along comes our boss, or another senior manager of the company, who wants to spend time to discuss a special project that the company needs us to focus on.

As a young IT manager, I fell into this trap hook, line, and sinker. I wasn't mature enough to know that I needed to manage this manager's expectations of what my IT organization could accomplish. I also didn't have a clue in those days about quantifying capabilities and measuring capacity.

So the result was that I would sign up for the new project without taking anything off our already full commitment list. The result was just as you might expect. We didn't deliver everything we committed to. Fortunately, I quickly learned how this works and was able to do a better job in managing expectations. But the initial learning curve can be a tough lesson.

If your plate is already full, you can add more to it only if you remove something first. When you do a good job of quantifying your capability and capacity, it gives you and your clients more power in being able to balance the workload more effectively so you concentrate on the most important issues.

Most companies want and need more than your IT operation can deliver. Spend time to truly understand and communicate your capabilities and capacity, and manage your clients' expectations around what you can deliver—not around the number of requests. . Pull them into the decision-making process of determining your IT priorities, since they have a vested interest in what you do. When they become part of the prioritization process and begin understanding your capabilities and capacity limitations, you'll find it easier to balance the work.

TechRepublic originally published this article on 1 June 2004.

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