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Optimizing Enterprise IT

Industry surveys have shown the average enterprise spends up to 80 percent of its budget on maintaining existing applications and infrastructure (September 17, 2003). These costs are continuing to grow. The industry is aware of this challenge, and is working to deliver solutions that automate many critical and time-consuming tasks. Yet every IT organization must also address the major sources of cost and complexity in their unique environment. By optimizing infrastructure and operations, you can spend less on maintaining the status quo, and more on new projects and initiatives that deliver direct value to your business.

This article identifies six key strategies for IT optimization. Together, they can put your organization on a path toward continual optimization that delivers better and more measurable business value and lower total costs.

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1. Compare your IT spending with industry norms

Though every business has unique requirements and challenges, IT benchmarking can provide new insights and an essential reality check on internal assumptions. Initial efforts can focus on comparing costs and service levels, yet it is also important to understand operational practices and trends. Monitoring the approaches of other IT organizations can help you find the right balance between cutting edge innovation and proven strategies.

2. Move toward better alignment with business goals

IT is maturing, and a new level of business sophistication is required. Technical decision-makers must work closely with their financial and business counterparts to accurately model, measure and understand the cost, value and risk associated with all major IT investments. Formal methodologies, such as the Balanced Scorecard, Total Quality Management (TQM) and Six Sigma, are bringing new rigor to this task. Such tools can provide a quantitative business context to help you reduce the risk inherent in subjective decision making.

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