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13 January 2009

2009 - the year of opportunity

By Andrew Clifford

The economic downturn will put a pressure on costs, increase compliance requirements and force organisational change. But there are huge opportunities for organisations who can weather these storms.

The economic downturn will have deep and widespread effects across all aspects of organisational life.

Within IT organisations, I expect to see:

  • A loss of business (for external organisations), and a pressure to contain and reduce costs (for all organisations).
  • Few, if any, major new projects. We will have to live with the systems and technologies that we have.
  • More controls. Some industries may be subject to more regulation, and this will trickle down into the work of their IT departments. But all organisations will be subject to more scrutiny, especially ensuring that the organisation is getting good value for money.
  • Organisational changes. The lucky organisations will have staff cuts; the unlucky organisations will be taken over; the really unlucky organisations will fail.

Despite this, I am hugely optimistic about 2009.

An economic downturn amplifies competitive forces. In the good times, it's easy to make money. In a downturn, only the truly efficient and customer focussed will survive. Nobody enjoys the downturn, but at the end of the downturn, the better companies have a bigger share of the growing market. If you can weather the storm, you can be there.

The downturn gives us in IT a bit of much-needed breathing space. For years, IT has suffered under the constant pressure to deliver projects and new systems. We have been very ambitious, and have used IT to demonstrate the organisation's capability and vision. We simply have not had the time to manage what we have well, and many of the systems we have are slipping into unsupportable legacy. As money for new investment dries up, we can grasp the opportunity to do some of the less glamorous but very much needed background work.

Although spending cuts may force staff shortages, there will be fewer skill shortages. The emphasis in IT will shift away from the management of huge teams of "resources" to the effective use of smaller teams of more skilled people.

You can see the downturn as wholly bad, keep your head down, and hope it doesn't hit you too hard. Or you can accept the reality of the downturn, see it as an opportunity to change, and take that opportunity full on. Whichever attitude you have will be self-fulfilling. If you don't adjust, you risk being swept away, or being overrun by competitors. If you embrace the downturn, and use it as an opportunity to refocus, to cut costs, to build a good basis for the recovery, you can prosper.

You might think I'm being optimistic, or biased because my business is all about managing cost reduction, compliance and organisational change. But I believe there are opportunities for all types of business. Next week I want to start by suggesting how you can use the idea of opportunity costs to make a really good case for increasing some types of IT investment in the current economic climate.

If you let it, 2009 can be a great year of opportunity.

Next: IT opportunity cost in a downturn


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