Downturn Déjà vu

I came across some tidbits from a study by former Gartner analyst Theresa Lanowitz that talks about the need for us all to remember the lessons learned during the last economic downturn: Resist the urge to slash IT.

I couldn't find any more than some dribs and drabs - and I haven't yet signed up for a free membership to read the entire study - but there were some interesting tidbits that are as full of wisdom today as they were in the last financial meltdown in 2000:

• Outsourcing to cut cost: Outsourcing was viewed as a panacea, however, many IT organizations spent more money because of poorly planned and implemented outsourcing schemes.
  
  
• Lack of innovation on the vendor side: This led to lack of innovation and education on the IT side. IT organizations were in turmoil because spending was dramatically reduced, and software vendors stalled new products and focused only on necessary items. IT did not have the leverage with either the line of business or vendors to demand new technology to support very real issues.
  
  
• Poor quality: The reduction of IT spending saw the demise or vast reductions in QA organizations. Many IT managers and even consulting organizations viewed “quality” as extraneous and something anyone could do.
  
  
• CFOs made business and technology decisions: Technology decisions were simply made on the basis of initial purchase prices with no regard to how the decision would ultimately affect the business. The CFO-led purchasing power elevated a person in the organization who had no technology awareness to a level of ultimate and final decision maker. The impact from CFO-led purchasing decisions was far reaching and long lasting.

Well, I'm old enough to vividly remember the last downturn, and I'd be a crack-smoking idiot if I thought that IT should be immune from cuts - BUT you don't need to just throw out the people that are making a huge difference in your IT organization, just because their salary level is higher than the repetitive-stress injury-just-got-out-of-college-and-was-hired-because-my-dad-works-here junior staffer.

The phrase "software runs the business" has never been more true. The "downturn" will turn into an "upturn" at some point in time - so don't be so short-sighted that you lose the people that will be instrumental in your future growth, and who are likely the ones that will help sustain your operations during the downturn as well.

Lanowitz is a way better writer than I am - and she put it very succinctly:

All too often in a time of economic downturn, people are seen as disposable, and most often, the more expensive a head is, the easier the justification for reduction. For businesses to remain competitive and grow during this economic downturn, retain key people. DO NOT just keep the less expensive heads… The IT organization of the future is less about those who can perform repetitive, manual tasks than it is about those who have skills to manage projects, act as a conduit of information, and view IT as a strategic enabler to the line of business.

Amen to that, sister!