AKIBIA'S PRACTICAL GUIDE TO ENTERPRISE TECHNOLOGY
Wednesday, June 17, 2009
A Letter to Ralph Szygenda, the CIO of General Motors
Dear Mr. Szygenda,
I just finished reading the Q&A Mary Hayes Weir of Informationweek conducted with you regarding your responsibilities in leading GM's IT department through the bankruptcy and restructuring.
You highlighted some critical steps that your IT team will need to take this year:
- Refocus budget to align with changed environment
- Bring vendors in-line at lower costs
- Align IT with business requirements to spur growth and innovation.
Mr. Szygenda, unfortunately GM has to manage to these goals while under a media microscope, while most CIOs report only to their executive management, boards and investors. But rest assured that these challenges are not unique to GM.
Akibia's recent CIO survey shows that CIOs all across the US and Europe share many of GM’s IT challenges.
- 94 % of the CIOs we interviewed reported budget cuts of 25% or more
- 70% of respondents say that increasing business efficiency and agility is a major focus
- 40% are focused on vendor management or rationalization.
- Many said that reducing complexity within the infrastructure in support of compliance was a major goal, which goes hand in hand with increasing efficiencies.
While it's true misery loves company, that's not the point of this note. Instead, I'd encourage GM to lean on a network of CIO contacts to understand the solutions they have uncovered for these issues.
The CIOs we spoke to mentioned vendor rationalization reviews as an effort to reduce duplication in their outsource partners and leverage greater economies of scale through fewer partners. These reviews will free up operational budget to focus on critical new projects that more dramatically impact business results or save existing IT staff, who can focus on key priorities.
Your peers are evaluating existing investments to see if those solutions can be leveraged in new ways, or functionality can be expanded to solve current issues without significant new capital outlay. CIOs are making calculated and strategic investments in tools like virtualization and WAN optimization to reduce costs in the data center and position their infrastructure for future growth. Identifying existing solutions within the infrastructure which can handle multiple requirements and reducing overlapping infrastructure will help reduce costs through maintenance reductions, and increase efficiencies through utilizing fewer platforms. This also helps when it comes to compliance complexity.
While GM’s IT challenges are more public and certainly the size of GM’s infrastructure and IT budget has few peers, the issues you are looking to solve are mirrored across many IT organizations.
Best,
Robert Klotz
