Unfortunately, such understanding is rare. "It's hard to get the CEO to stand up and say, 'This is the way we're going to do it,'" Fenwick says. But if the CEO doesn't do that, he adds, "every little department will want to customize the technology to make their part of the business run more efficiently -- and so they should." After all, each department is being judged on its own efficiency, and anything that can make it run better is a good thing -- from the point of view of the department's managers. But the approach leads to systems that are difficult and costly to maintain.
"Over the past 10 to 20 years, we've plowed millions of dollars into software customization to support generic capabilities," Fenwick says. "It has made IT more complex, made interfaces more difficult, reduced IT's agility and added cost."
There's one last reason it can be difficult to contain keep-the-lights-on costs: You may become a victim of your own success. "We've determined that it'll be pretty tough to get to 50-50," says Peter Forte, CIO at Analog Devices, a semiconductor maker headquartered in Norwood, Mass., with annual revenue of $2.6 billion. "The reason is, the more successful you are on the right-hand side, that drives more activity to keeping the lights on. Every new system we deploy is a system that needs to be maintained."
Here's a look at strategies that can help CIOs who want to spend less on keeping the lights on and more on innovations that will help the company reach its goals.
Virtualization
If you haven't gotten around to virtualizing servers, you may find that doing so is an effective way to cut keep-the-lights-on costs. Forte discovered that when a normal cyclical low in the semiconductor industry coincided with the worldwide economic downturn of 2009. "We lost 30% of our revenue almost overnight," he says. As a result, IT had to quickly cut 30% of its costs, leading to significant layoffs.