Bob Evans of InformationWeek recently wrote an article –
‘CIO as Chief Cost Cutter’.
He states that with the IT organization’s unique opportunity to see the web of business processes that run across the entire organization, CIO’s are in a great position to attack inefficient systems and processes to liberate precious cash.
He goes on to say that cost cutting is not enough. When the economies turnaround and businesses start to grow, will your customers be satisfied with the capabilities your company had in late 2008? Will competitors that have cut not only costs but also product development time and customer engagement cycles box your sales team out of opportunities?
He concludes that right now is an excellent time to pull together a plan for innovation during cost cutting. Your main objective as CIO is to help drive greater business value and customer value.
Bob is writing to the CIO, but he is telling my story – The economic downturn provides an excellent time to drive for ‘greater business value and customer value’.
Over the last several weeks, I have been talking profitability in this new economy. I have stated that the road to profitability is paved by the Triple Crown of Business [lower costs, increase revenues and improve customer interactions].
In 2009, the challenge for all companies is to emerge from the downturn in a stronger position than going in.
Now is the time to review your ‘web of business processes’ that run across your organization. There is likely an 80/20 rule on these processes – 20% of the processes should account for 80% of the costs. So, review the ‘20’ to remove non-value added activities. But don’t just think cost cutting, this is a good time for innovation. Look to cut costs while improving customer interactions.
If you don’t do anything, you could get left on the side of the road. Now is the time to strive for the Triple Crown of Business so that your company can be a leader coming out of the economic downturn.