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Ideas from IBM

Even the largest companies have struggled to achieve scale and expertise in their IT organizations. A recent study of financial service sector IT organizations by the IBM Institute for Business Value, for instance, found that one third of internal IT projects run over time, one fifth run over budget and one fifth fall short of planned functionality.

Sourcing alternatives, along with new IT management solutions not only offer expert, cost-effective IT operations at massive scale. They also provide an opportunity for progressive CIOs to drive the new innovation agenda. How? Sourcing alternatives offer an opportunity for progressive CIOs to create a self-funding model for new opportunities.

Despite the demands of the CIO's new and elevated organizational role, freedom of action continues to be circumscribed by the responsibilities of maintaining legacy systems and the realities of tight budget and resource constraints. IT sourcing alternatives give the CIO the flexibility to bridge old and new responsibilities.

In IBM's experience, alternative sourcing models have the potential to deliver cost savings of 15 to 25 percent, or even more. With IT budgets virtually flat, these savings can be used to invest in new capabilities. In this way, the organization's own IT infrastructure can be put to work to fund business enablement, innovation and top-line growth.

Related links:
Insights for today's CIO
The IT balancing act: containing costs. Enabling innovation.
Eliminating the strategic blind spot: how IT drives innovation
From theory to reality. IT portfolio management in financial services
IT: A component-based approach to strategic change
The Component Business Model: now available for IT
Case study: Bharti Tele-Ventures: Outsourcing enables support of eight million mobile customers
Case study: KEC Group sharpens competitive edge in semiconductor market by outsourcing IT
Case study: GHY International. Trade services company sharpens business focus by integrating IT, using open source
Industry at large
Visit CIO.com: Special report: "State of the CIO"
Listen to CIO.com podcast: IBM's Mary Garrett on the leadership role of the CIO
Go to CIO Insight.com: "Are you the leader you think you are?"


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