Chapter ten

This chapter told us that there were some savings in IT management such as improving IT business inefficiency, the greater the inefficiencies, and the cut. For the smaller inefficiency, the companies should increase efficiency in operations for their business, limited 0ff-shoring, and re-examination of labor. These ways may help the companies reduce 10-20 percent of costs. For the larger inefficiency, the business groups should be combined with IT staff in the cost analysis. However, combining the business groups and IT staff in the cost analysis sometimes has the conflict because nobody likes his groups’ budget cut. This way may help the companies reduce 20-40 percent of costs. The final group includes companies burdened with a 40 percent or more cut because they let spending get out of control for many years. Thus, there are some approaches to cut costs effectively. IT groups can focus on operational efficiencies. With operational efficiencies, companies look to maximize current technology investments to get more speed, capacity, and use out of current equipment and labor. Business and technology groups understand how much is being spent on technology, the business groups can understand the profile of technology spending and correlate it with use. This allows the technology and business groups to see where cuts can be made. The final area of focus is business efficiency. Technology business efficiency focuses on how clever companies are in their overall use of technology. Thus, this last means of cost cutting is led by business groups that focus on investment return and whether a technology provides a benefit to the corporation. The evaluation metrics should include factors such as gross margins, customer satisfaction, and increase in sales.