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As a significant cost center, the IT department is under renewed pressure to play its part in the enterprise-wide drive to trim operational costs. In this podcast, Bob Melk, publisher of CIO magazine, talks to Accenture’s Michael Nieves about the challenges this situation poses for CIOs.
A senior executive in Accenture Technology Consulting, Nieves argues that CIOs must resist the temptation simply to cut discretionary spending, while leaving operating expenses untouched. This approach undermines a company’s ability to make significant and sustainable IT cost reduction and will hinder its capacity for growth and innovation in the long term—and thus its ability to achieve high performance. Although CIOs have already taken significant costs out of their operations, there remain many hidden IT costs that should be examined. Removing these hidden costs, in fact, can be done in such a way as to improve IT performance. In other words, cutting costs and high performance can be achieved together, not at the expense of each other.
Nieves goes on to outline Accenture’s three-step approach to identify and implement cost-cutting initiatives that expand the scope of the overall cost savings—and the performance enhancements they bring.