The Slowdown: Learnings for CIOs

Given all the noise about the US slowdown and how it's impacting the Indian

economy, it would be only natural to expect Indian organizations to slash their

IT budgets, freeze work on all IT projects, and limit all IT purchases. But to

our surprise, our interactions with the CIOs of some leading Indian enterprises

didn't quite give us as adverse results as we were thinking them to be. Yes,

Indian CIOs have become conscious about the slowdown, but they're not going

overboard with the same. They're continuing with their critical IT projects, and

have deferred the less critical ones. All unnecessary IT purchase has been

limited, but IT budgets haven't really been slashed. While it's good to follow

this level of cautious optimisim, it may not be sufficient in the current

situation. It might limit more equipment from getting added to the IT

infrastructure, but it doesn't address the woes of managing the same.

Therefore, CIOs must use the current slowdown as an opportunity to cut down

all the flab, slow down on new IT projects, and focus on getting more out of

their existing investments. This is the right time to improve efficiencies and

get more out of your existing investments. One of the things to focus on is

automate as many manual processes as possible. In fact, by optimizing your

current IT infrastructure, you're also improving time the economy pulls itself

back into shape, while your IT infrastructure would be ready to move to the next

level.

That's why our IT strategy story this time acts as a guide for CIOs to

survive the slowdown. We start by assessing the overall impact of the slowdown,

and then drill into specific bits on what kinds of technologies and processes to

adopt for combating the slowdown. Some of the results we got were pretty

interesting.

Impact of Slowdown on IT



When we quizzed IT decision makers across India about the impact of slowdown on
their companies, only 6% claimed there has been no impact at all. It's no secret

that slowdown is starting to impact Indian IT companies. So far the impact

hasn't been much serious and we really hope the situation doesn't get any

further worse. To find out how much it impacts IT departments and IT projects,

we asked CIOs about state of their current IT projects. More than half of them

accepted that a few IT projects have been deferred and almost a similar number

claimed that their further IT purchase has been limited.

In our survey, we asked CIOs about the measures they have taken to survive

the slowdown. A major chunk said that they are currently renegotiating their

contracts with vendors and looking for innovative ways to cut costs.

Re-negotiating existing contacts isn't a bad idea, as vendors under the impact

of slowdown, may offer you better deals than competition. Plus there can be

instances where you can get some of the clauses to be reviewed to get you better

prices. Similarly you can also review other costly projects. Most CIOs claimed

they are looking to utilize their current resources to a maximum level. This

just doesn't apply to IT but also to IT personnel, and lead to higher employee

utilization levels.

Another issue with cost cutting is that it mostly leaves your employees as

well as end users unhappy. At times this might be because the change you made

might cause a few difficulties which you might not be aware of. Our survey found

that it is better to take feedback from end users and employees itself of how to

better utilize your current resources. Sometimes, the best of all ideas come

from end users only.

Where to invest in 2009?



With tight budgets, IT decision makers are being more and more careful before
they finally invest in any particular technology. When we asked them about

predicting the next year's IT budgets, only 16 percent of them expect it to

increase. When we asked how much the current slowdown is likely to affect their

IT budgets, half of them feared that their IT budgets are likely to get slashed

in future.

As far as investments in new tech are concerned, pretty much like last year,

IT decision makers remain keen on Virtualization and communication solutions

such as VoIP, Video and Web Conferencing. Also WAN optimization and Open Source

solutions look to be big beneficiaries in 2009. Another interesting observation

thing we found is that IT decision makers are finally taking Cloud Computing

seriously and few plan to invest in it, in the coming year. Other areas where

CIOs are likely to shell out money include Security, Business Intelligence, ERP

and storage solutions.

Manpower issues



For the last couple of months, there hasn't been a week or so, when we have

not heard news about a company laying off its employees. Thankfully in India,

and especially in IT, the situation isn't that bad. However IT topshots warn

that under performers could be asked to leave. When we asked them whether they

have any intentions of reducing their IT team, most of replied with a No. When

we asked if slowdown is going to effect their future recruitments, we got a

mixed response.

Countering slowdown with technology



Optimizing existing Infrastructure: Instead of buying new equipment look for

ways of how you can get more out of your existing infrastructure. When it comes

to data centers, using technologies like virtualization, data de-duplication,

compression can really help.

Many companies are also taking calculated risks of switching off their

non-critical mission servers at night. While this might not be possible for all

companies, but if you could just ensure that all PCs in your enterprise are

switched off at night or whenever they are not in use, you will be able to save

a significant amount of power. Some companies are even willing to take the risk

of running their data center a little warmer than usual. This quick way to save

power, could however be a little risky. If you plan to try this out, start doing

it gradually and with due diligence.

Use Video/Web Conferencing: Slowdown is a boom for video conferencing

vendors. As enterprises look at ways to cut their travel and overnight stay

costs, Video conferencing and Telepresence are the most commonly sought

solution. Read more about the benefits of deploying video conferencing in the

story on telepresence, also featured in this issue. However, simply deploying

video conferencing isn't enough, look for ways to motivate end users to use it

as well.

Paperless Offices: One of the most talked about ways but still not

implemented/followed properly in enterprises. Deploy workflow/ERP solutions to

automate processes which are still on paper. Setup print quota's for users to

ensure printouts of only important documents are taken.

Use Open Source Solutions: Open Source solutions can save huge amount

of costs. Using open source doesn't always means replacing your Windows machines

with Linux, as its not always an easy thing to do for enterprises. However, you

can use open source solutions on top of Windows. For eg, almost every

application requires Office applications, and if you could just replace

MS-Office with OpenOffice or a similar application, you can reduce decent

amounts from your IT bills, The point is, wherever possible look for cost

effective solutions.

Consider Outsourcing: For new projects or if you plan to upgrade your

data center, consider outsourcing your data center or other parts of it. To give

an example, if you outsource your data center, you can save on maintenance

costs. Also you would not need to hire new personnel for maintaining a data

center. Similarly, consider SaaS and cloud computing as they can help you reduce

project costs significantly.

Use Skype: Reducing your telephone costs is another easy way of saving

money. For calls abroad and outside state, you can use Skype to Skype calls or

other Internet messengers (now even GMail supports voice and video conferencing)

to unitize bandwidth at your disposal.