Editor's Note: IT's role in alleviating panic

Computerworld - In an e-mail exchange with an IT executive in Minnesota last week, I asked about the role chief financial officers play in determining which IT projects receive funding in these troubled economic times and which are kicked unapologetically to the curb. Given that IT outlays often account for a high percentage of a company's capital expenditure, is the CFO's role more prominent these days?

The executive, Thys Coetzee, an IT director in Eden Prairie, responded with the common sense that tends to be typical of people from the Upper Midwest.

"CFOs are supposed to help the execs see what the financial ramifications of any decision are, IT execs included. It is a team effort to take an organization forward after that," Coetzee said. "I backed off on a highly important IT project just the other day because the CFO could show me an extremely sensitive issue looming. Will we pay from a technology standpoint and at some risk to the company? No doubt in my mind. Was the CFO right to want me to hold off? With the data at hand, absolutely. Rocks and hard places are, after all, what IT is about."

Indeed, knowing when to back off is key to any CIO's survival at a time when even demonstrable ROI is no longer sufficient justification for an IT project. But even more critical to survival is knowing which projects to champion in the first place.

That's the conclusion I drew when I read this week's cover story, Tam Harbert's "Saving Strategic Projects." The article is meant to offer advice on "how to keep make-or-break IT initiatives off the chopping block in troubled times," but it would be a serious mistake to read it as some sort of battle plan for defending the IT kingdom.

Coetzee's emphasis on the IT executive's role as one that contributes to the decisions made by the executive team is echoed throughout the article. "The CIO is first and foremost a member of the management team," said Sunoco CIO Peter Whatnell. The CIO needs to focus on sustaining the company, not on buttressing the company's dependence on IT.

Harbert also cites Gartner analyst Jorge Lopez, who spoke of an IT executive at an oil company who's evaluating projects based on cash flow rather than ROI. "Whatever project you want to save and are staking your reputation on, it had better be connected to dealing with this [economic] storm," Lopez said. "Because if it's not, not only will the project be gone, but if you fight for it, you'll be gone, too."

Often, then, the biggest contribution IT can make is to initiate projects that will enable expense cuts and ease the company's immediate cash-flow problems. In an e-mail exchange last week, Cora Carmody, senior vice president of IT at Jacobs Engineering, said now is the time to explore new technologies like Google Apps -- low- or no-cost technologies that in the past seemed "wacky" to traditional IT shops but now "might actually have the traction for the enterprise."

That point is reinforced in our cover story as well. Vivek Kundra, CTO for the District of Columbia, had a $4 million budget to build an intranet for the district, which has a debilitating $130 million budget deficit. Using cloud computing, Google Apps and wikis, he built it for $475,000. Meanwhile, Sunoco's Whatnell wonders why companies aren't using Skype instead of some obscenely priced videoconferencing system.

The trick, of course, is to cut costs without overreacting in a way that decimates the company's productivity. Coetzee cited an item in last week's Shark Tank about a company that banned mobile employees from accessing the Internet by any means other than dial-up. Clearly, we need to be smarter than that.

"I can bring resources to bear for the line-of-business folks and save them time and money," Coetzee said. "Panic if you must," he advised the LOB'ers. "But not blindly."

Who would have guessed that alleviating panic would have found its way into a CIO's job description? Then again, who better to do it?

Don Tennant is Computerworld's senior editor-at-large. You can contact him at don_tennantcomputerworld.com, and visit his blog at http://blogs.computerworld.com/tennant.

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