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How to use budget cuts to get a leaner IT system

We look at how economising will continue through 2011

Meticulous budgeting and economising technologies have helped sculpt trim new IT outfits. Here's how IT will maintain its slimmer shape in 2011.

Running for cloud cover

Chan is also looking outside of his IT organisation for solutions. "I think we spend entirely too much time tinkering with hardware," he says. "Over time, we can outsource most of our IT infrastructure. Instead of buying and building and managing servers, potentially we could engage a cloud provider and rent capacity. We are experimenting in-house with cloud, but there are still a lot of security-related concerns."

Haggen Inc has already extensively consolidated its data center operations by virtualising servers. "Now we're looking at storage rationalisation and optimisation," says CIO Harrison Lewis. "Before, we might just acquire more storage, but now we're looking at Tier 2 and Tier 3 data and moving it off to a private cloud."

A recent internal study showed that 49 percent of data that Haggen had been storing hadn't been accessed in two years. This has prompted a more rigorous review of all IT assets, with an eye toward distinguishing exactly what offers a competitive advantage and should be kept in-house and what should be outsourced.

"If it's not an area where we need to do a great deal of customisation, software-as-a-service makes sense," Lewis says. In 2011, Haggen will be evaluating other SaaS options, including Google's suite of productivity applications. "From everything I've seen so far, it can make sense for us," notes Lewis.

The bottom line, says Forrester Research analyst Bobby Cameron, is that companies will focus on continuing to drive down costs throughout 2011.

"As the IT organisation focuses more on process, they're also consolidating IT, moving to shared services, and there is a huge acceleration in their ability to automate services," he says. "The whole concept of pre-provisioned environments - with cloud and virtualisation - takes automation to the nth degree.

"All of these accelerants are going to continue to drive down the cost of delivering IT," adds Cameron, not only in 2011, but for the foreseeable future.

NEXT PAGE: Austerity yields new appreciation for IT

  1. Economising will continue through 2011
  2. Investments in some firms are at a standstill
  3. Push-button processes
  4. Running for cloud cover
  5. Austerity yields new appreciation for IT

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