CFOs Eye IT Assets
by Ericka Chickowski
McKinsey & Company consultant Stefan Spang recently wrote a prediction piece for the company's quarterly newsletter that outlines five trends that will influence business technology this year. While there was nothing groundbreaking in most of his predictions (we all know that regulators are coming to get us), one tidbit did catch my eye:
In a world where capital is at a premium, CFOs will seek to use IT assets as a lever to generate cash. They may sign outsourcing deals that include a bigger financing aspect, such as having IT service providers make a large up-front payment in return for higher margins over the course of a contract. They may sell and lease back hard assets, such as data center facilities. They may place favorable vendor financing at the core of hardware and software purchasing decisions...I agree with Sprang that CIOs are going to need to partner with the CFO to creatively tweak their budgets, especially once IT has trimmed most of the fat through layoffs and the like. In particular, I think that CIOs really need to take a closer look at their asset management and vendor relations programs.
The consensus among most of the experts I've interviewed is that enterprises simply do not maximize the assets they already have because they don't know what assets they have. Similarly, they don't get the most out of their money from vendor contracts because they often don't have crystal clear visibility into what it is exactly that they need. This is how organizations get into situations where they, say, overbuy software licenses or maintain abysmal storage utilization rate.