Management Strategies

02:13 PM
50%
50%

The Dreaded IT Budget Cut: Myth, Reality, Transparency

On the surface, a 10% cut on a $2 billion IT budget seems easily attainable. In reality, it isn't.

Executive and business management rarely have the transparency they need in terms of the technology economics of the IT function. As a result it is easier to specify “cuts” than to make them happen. Therefore there is an urgent need for IT management to provide more exacting and insightful views into the cost structure of IT – what is controllable in the short term and what is not. In short, there are many misconceptions surrounding realities of IT budget cuts.

The ScenarioA financial services company is focusing on managing expenses downward in the face of flat or declining revenue and increasing regulation. A Board and Operating Committee that has reviewed company expenses, has identified IT as being among the top five expenses in the company. Leaders mandate that IT should reduce infrastructure costs, currently at $2.5 billion, by $250 million (10%). Sound familiar?

[Read the Rest on Wall Street & Technology]

Dr. Howard A. Rubin is a Professor Emeritus of Computer Science at Hunter College of the City University of New York, a MIT CISR Research Affiliate, a Gartner Senior Advisor, and a former Nolan Norton Research Fellow. He is the founder and CEO of Rubin Worldwide. Dr. Rubin is ... View Full Bio

Comment  | 
Print  | 
More Insights
Register for Bank Systems & Technology Newsletters
White Papers
Current Issue
Bank Systems & Technology Oct. 14, 2014
Bank Systems & Technology's new Must Reads is a compendium of our best recent coverage of customer analytics. Learn what big data means for banks, meet Wells Fargo CDO Charles Thomas, find out how to connect with your Gen Y customers, and more.
Slideshows
Video
Bank Systems & Technology Radio
Archived Audio Interviews
Join Bank Systems & Technology Associate Editor Bryan Yurcan, and guests Karen Massey and Jerry Silva from IDC Financial Insights, for a conversation about the firm's 11th annual FinTech rankings.