Crisis Time

What to do when incrementalism just isn't enough

November's CIO Year Ahead Summit wrapped up with an open "town hall" session in which participants tackled the toughest problems in IT. Our starting premises:

  • The current global economic crisis affects companies across all industries.
  • Trimming and tweaking won't suffice; you need to think in terms of crisis management.
  • Budgets, people, operations and supplier relations will all need to change.

Seven members of the CIO Hall of Fame led tabletop discussions, then convened onstage to share their own and their groups' ideas for navigating a turbulent 2009. Here are some of the highlights:

You have to cut services, plain and simple. Some people scoffed and said, "They [businesspeople] will never go for it." These people clearly weren't thinking in crisis mode yet. Advice from the Hall of Famers: Start having conversations now with business leaders about priorities and what services you'd cut if needed. That will simplify things when the time comes.

Keith Morrow, CIO at Blockbuster (a business that entered emergency mode well ahead of the current recession), said his executive team developed three contingency plans: expected, worst case and better case. Doreen Wright, former CIO of Campbell Soup, suggested an exercise in which you pretend you're bankrupt and talk about what you have to do to survive. Then look at what you can add back. That will get you much further than making cuts based on your current budget.

Get your vendors to pony up, said former Motorola CIO Patty Morrison. Have an adult conversation: We need you to take out 25 percent of our costs; what do we need to change to do that?

Stop capital expenditures quickly—that will give you some breathing room to find other areas of efficiencies.

Develop tight telecommuting policies. Why spend all that money on facilities for staff who could just as easily work from home? Deploy converged devices (and keep multiple redundant devices to a minimum). Use desktop virtualization to avoid the costs of moving equipment when employees change their workspace.

A common theme underlying everything: You have to know your data, your own numbers and your cost of consumption, in order to have intelligent conversations about where to invest and cut back in the first place.

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