Gartner is telling clients to ready their technology cost cutting plans ahead of an economic slowdown.
In October at its Symposium conference, Gartner told clients to prep two IT budgets. One assuming business will continue as usual and another assuming the worst--or a recession. It now appears that Gartner is clearly in the latter camp.
In a statement, Gartner research fellow Ken McGee said:
Last October we published research recommending that organizations should prepare two IT budgets for 2008, the first reflecting guidance already provided by senior decision makers and a second ‘backup' budget assuming the need to cut costs in response to the arrival of a business slowdown. Since that time the factors we based the research on - such as GDP growth projections and expert predictions for the likelihood of a recession - have worsened to a degree that convinces us it is now time for clients to prepare for cutting IT costs.
Gartner argues that technology executives shouldn't wait for the official recession bell to be rung. CEOs and CFOs are likely to issue mandates of IT cost cuts as part of a broader cycle.
Among Gartner's tips for cooking up a IT cost cutting plan:
- Don't wait for the mandate from above. You should have your team ready to fly on the cost cuts. With any luck you won't need them.
- Choose the best IT people for the cost cutting team. Gartner also says that year end bonuses should be tied to savings.
- No finger-pointing.
- Enlist a scorekeeper to track IT savings. When a company is cutting costs across the board IT needs an official scorekeeper for the record.
- Report cost cutting progress weekly.
- Bring in the lawyers so you can figure out contractual obligations with vendors, maintenance providers and the penalties involved if you bail.
Gartner's advice is a bit high level. Another option would be to push along those projects that should be underway but may be going slowly. Consolidate those apps, retire those legacy systems that just cost you time and maintenance and move to architectures that can set you up later when the economy recovers.