Abbie Lundberg, Editor in Chief, CIO

advice.cio.com/blogs/difference_engine

CIO PulseSeptember 2008

22

business realities

Demand for growthEconomic uncertainty

Shifting business modelsDigital natives, consumerization of IT

High yet ill-defined expectationsInnovation and risk

33

44

economic uncertainty

photo by Fadzly Mubin

55

66

77

shift to cost cutting

What is the primaryFocus of yourInvestments?

CreateToplineRevenuegrowth

EnableBusinessProcessInnovation

Lower theOperatingcost of IT

Manage ITInfrastructur

eMoreefficiently

Past 12 months 20% 39% 16% 26%

Next 12 months 21% 37% 22% 19%

CIO Budget & Staffing Survey, June 2008

88

from ROI to TCO

Most important factor driving your ITInvestments the next 12 months

Jan. 2008 June 2008

Return on investment (ROI) 59% 52%

Total cost of ownership (TCO) 41% 48%

CIO Budget & Staffing Survey, June 2008

99

contingency plans

Do you have a contingency plan in place in the event you need to make cuts to your IT budget?

Yes, contingency plan currently in place 48%

Not yet but planning to implement 20%

No plans for contingency plan 32%

68%

CIO Budget & Staffing Survey, June 2008

1010

If a recession is to occur, how confident are you in your organization’s ability to manage through it?

riding the recession

Source: CIO Strategic IT Research Study, IDG Research, April 2008

1111

some examples

1212

extreme measures:TCO = 0?

1313

shifting business models

1414

digital

natives

web 2.0

consumerization of IT

1515

employees & customerswant to… • Create

» Blogs, videos, wikis, machinima (remixes)• Communicate, collaborate, share & engage

» IM, text messaging, social networking, photo sharing

• Participate, influence & be recognized» Rate & be rated, comment, vote

• Choose their own tools

1616

consumerization of the enterprise

Bechtel’s Project Services Network

• Infrastructure-to-apps overhaul of technology environment

• Goal: secure, ubiquitous, simplified, rapidly deployable access to corporate and customer information to any user around the world

• Role Models:» YouTube: high-bandwidth networking» Google: leveraged infrastructure» Amazon: extreme virtualization» Saleforce: multi-tenant application support

Upcoming issue of CIO Magazine, Nov. 1, 2008. www.cio.com

1717

enterprise web 2.0 spending

Source: Forrester Research

1818

shift to customer 2.0

• Large businesses spend more on employee collaboration tools than customer-facing Web 2.0

• That trend will reverse by next year

• By 2013, companies will spend nearly a billion dollars more on customer-facing Web 2.0 than on internal collaboration

Source: Forrester Research

1919

2020

innovation

risk

2121

discussion questions1. What strategies are you employing today to hedge

against rising prices and changing consumer behavior?

2. Is there still room to deliver more in the way of IT services while continuing to take out cost?

3. How suited is your IT infrastructure to a world of rapidly changing demand? What’s the best way to get to a YouTube/Amazon/Google infrastructure?

4. How do you balance innovation and risk?5. Case 1 – Your CEO sees opportunity in entering a

completely new and different market. What’s the first thing he needs to know from you?

6. Case 2 – Your company gets bought by a private equity firm and they want to quickly spin off some of your businesses. What do you do first?

7. Case 3 – The bottom falls out of a big chunk of your business. What’s the highest impact thing IT can do to a) cut costs quickly? b) shift to growth opportunities?