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Here are 3 reasons for CIOs to make IT cost their top priority right now

In the middle of the ongoing global pandemic due to COVID-19, with full macro-economic implications still barely imaginable - our discussions with IT and digitalization managers in the last weeks reveal 3 interesting lessons learnt moving forward across industries.

  • IT cost are still a significant burden on CxOs current top priority to secure short-term liquidity
  • Past investments in new digital enablers do not deliver expected value, investment backlog in former “nice-to-have” topics (e.g. new work) slow down recovery from COVID constraints
  • Companies struggle to find a good balance between cost optimization and need to invest – prioritizing areas “where to lose fat and where to build muscles”

Coming from a period where – driven by media omnipresence of “Digital Transformation” – money was not a limiting factor when it came to technology budgets, we foresee a significant paradigm shift towards a more strict “value-for-money” way of managing IT and digitalization initiatives.

We condensed 5 implications for IT managers, CIOs and CDOs to consider – not only to be prepared for this “new normal”, but take advantage of the current situation and retake driver-seat position moving forward:

From our perspective COVID outperformer:

  • Take a hybrid approach managing their technology roadmap holistically – combining traditional IT and digital enabler in one integrated portfolio
  • Streamline non-vital IT cost by up to 30% to regain room for smart digitalization decisions
  • Adjust their priorities to digitalize their business- and operating model - taking an updated critical view on their digital maturity to identify the most urgent gaps
  • Re-calibrate their strategic priorities and update their project portfolio of ongoing and planned initiatives critically
  • Apply a rigid “Digital Performance Management” approach managing value-for-money of their Digital Transformation

We at IAC have defined a strong framework to support companies in these challenges - with a straightforward 3-step approach to:

-Objectively identify IT cost optimization potential (“IT Cost Benchmark”),

-(Re-) prioritize current digitalization efforts in line with industry good-practices and operational needs (“Digital Health Check”),

-Update project portfolio to balance operational efficiency and future-readiness-enabling initiatives (“Technology Roadmap”).

If this sounds familiar, we are happy to share insights and experience from other initiatives with leading industry players.

Let`s get in touch!

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