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We'll Deal, but Will We Manage?

If IT management were synonymous with bargain-hunting, life would be easy. But it's not.
Scott Leibs, CFO IT
March 15, 2004

While there are many reasons why CFOs now play a larger role in IT strategy than ever before, the staggering cost of technology remains the biggie. True, IT has come to dominate the capital budgets of most companies. And true, when you're a CFO, finance is your middle name.

But let's look past the truisms. Almost every article in this issue falls into one of two categories: those that illustrate that technology is becoming cheaper and easier to buy, and those that show all too clearly that IT is becoming more difficult to manage.

Declining IT budgets and fierce competition have forced vendors to cede some power to customers, the result being that whether you buy or lease, you can cut better deals than ever before and take advantage of new pay-as-you-go plans that ease the burden on capital spending.

But just as the cost of a new PC represents a mere fraction of the total expenses associated with actually using it, so too does the slick deal-making threaten to mask the unfortunate truth that IT is becoming more complex to manage, not less. From internal wrangling between CFOs and CIOs (see "The Great Divide," page 26) to the Sarbanes-Oxley implications of offshoring, to the potential missed opportunity in teleworking programs, IT now demands far more than a hard-nosed attitude on the part of the buyer. A rigorous approach to ROI remains important, but what matters just as much, and probably a good deal more, is a collective strategic vision on the part of senior management.

There's truth in the old saw, "You can't manage what you can't measure." But there may be more truth in its corollary: "You can't leverage what you can't manage." New approaches to acquisition, new options in outsourcing, new demands posed by regulation, new demographic trends, and a host of other changes make it imperative that companies understand what and why they're buying before they worry about how, or even how much it costs.