Although global economic prospects have improved in recent years, the International Monetary Fund: World Economic Outlook 2013 states that the road to recovery will remain bumpy. Mature markets like Europe and the U.S. have stagnated, and export-driven emerging economies remain vulnerable to declines in global trade and fluctuations in capital flows. Many analysts and economists believe that volatility is here to stay.
In this environment of macro-economic uncertainty, CIOs are charged with improving both efficiency and effectiveness, accelerating business transformations to support growth and directing capital strength toward investing for expansion. These Top 5 considerations help point CIOs in the right direction.
1. Use data. Even before the recent love affair with big data, IT’s central purpose has always been to process information for business decision making. Uncertain times require a particular focus on instant and fact-based decision making. Use all available data to solve – and predict – problems and monitor performance.
2. Keep your eyes on revenue. The role of IT is to enable business and revenue growth. Harvest internal and service provider innovation rigorously. Rapid growth markets require a different pace of deployment – maybe even quick-and-dirty solutions to enable growth.
3. Drive costs down. Constantly and persistently explore new and sustainable ways to reduce costs. Reduce IT spend by improving process efficiency and automation, adjusting service levels and eliminating non-value adding complexity in the environment.
4. Use capital wisely. Cash is always better invested elsewhere than IT equipment and facilities. Incremental outsourcing can potentially contribute to working capital, and IT can indirectly free capital by providing mobile working environments to divest facilities.
5. Service Integration. Align IT and corporate strategies over the short, mid and long term. Enable this alignment by taking the sole service integrator role and providing end-to-end service to the business with balanced demand and cost-efficient supply from external and internal service providers.
ISG can help CIOs understand their value contribution, improve efficiency, cut costs, free working capital and integrate services. Contact Kari Jarnstrom to discuss further.About the author
Kari has been advising global manufacturing and finance clients on IT and sourcing strategy, service management and integration and outsourcing transactions for 20 years. His recent engagements include helping a 100B€+ company define its sourcing and service integration strategy and guiding a global manufacturing company through the IT transformation and outsourcing transactions. He has also led multiple strategy and assessment engagements. Kari leads ISG in Finland and the Strategy and Operations practice across the Nordic countries.