CIOs’ 2016 IT budgets are under pressure as a result of revenue challenges, currency weakness, and talent shortages. Cloud technologies offer cost benefits, but these take time to realise, and outsourcing is less attractive due to reducing labour arbitrage. So, where does IT go to find cost optimisation opportunities?

Collaborate; don’t compete, to exploit budgets directed to technology 

Marketing and other functions invest in IT capabilities, such as digital marketing technologies. This spending can account for up to 20-30% of the total IT budget. This spend is critical because consumers increasingly use technology in their daily lives and with the availability of Software-as-a-Service (SaaS) applications it is far simpler. Rather than trying to control this spending, it is an opportunity for IT to effectively increase the IT budget by providing input to these functions.

How can this be done?

1. Educate Marketing and other functional heads about vendor and technology selection risks, and become a partner to these functions
2. Focus on innovative systems with less potential to compromise transactional data or customer information, for example a mobile loyalty application
3. Establish ‘lighter’ governance to match the lower risk profile of these types of systems