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Experienced Information Technology leader, author, system administrator, and systems architect.

Wednesday, May 1, 2013

Tactical vs Strategic Spending

Alix Partners released a study discussing the importance of focusing on strategic vs tactical IT expenses.

When there are cost reduction pressures, it is sometimes easier to cut a strategic project than to go after expenses in operational, day-to-day IT. Unfortunately, that is exactly the wrong mind-set to take into budgeting.

Ongoing expenses need to be managed aggressively. Look for old assumptions and unused capacity. Clean up and reduce where possible. Negotiate tough deals with your suppliers. Look for projects that will reduce your ongoing operational expenditures.

For most of us, our employers view IT as an expense, not as an investment. Part of that is our fault. By focusing on eliminating strategic expenses rather than controlling operational expenses, we have limited our ability to make our organizations more competitive and efficient. As IT leaders, we have the power to turn things around by changing how we prioritize IT expenses.

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