Markets change, expectations change. For instance, last year, when consumer demand was at its peak in India, IT functions across organizations were struggling to match the speed of expansion with adequate infrastructure and support. Everything was in short supply: land, power, infrastructure, and people – this list can go on and on.

Cut back to the situation now. With dampened consumer demand, the tide has reversed. The same IT function which was hard pressed to match the growing demands of business is now being asked to look inwards, and suggest ways to cut operational costs, without sacrificing the efficiency of the business. While the strategic vision of what IT must do remains, the immediate focus is to cut down waste, and justify every ‘rupee’ spent on IT.

Perhaps at no other time in the history of the Indian economy has a CIO been faced with such a moment of truth. They have to identify projects that deliver returns quickly, improve decision-making ability, and target markets or customers more efficiently – all at lesser costs than what has been budgeted. The increased expectations from the IT function can be best seen from the IT vision of HDFC Bank’s CEO, which has set high standards for the IT team and expects the function to continue to deliver best-in-class customer services, with a minimum of 100 process improvements annually, and 30% cost reduction on an annual basis.

“Do more with the same, and then do more with less, is our mantra for efficiency,” says Munish Mittal, Executive Vice President forInformation Technology atHDFC Bank, echoing the thoughts of otherCIOs who are being asked to do the same in their respective organizations. To bring down operational costs, Mittal’s team is working on significant virtualization initiatives, including redeploying IT resources from within, rather than hiring from the market. Mittal says that consolidation and virtualization will help in pooling an average of 20% to 30% spare capacity available in various standalone systems and application solutions, which in turn can support seasonal and peak capacities for some businesses without specifically locking capacity for these applications.

At travel and financial services giant Thomas Cook, where IT budgets are down by 20 percent, Sohrab Dave, the Associate VP forIT, is using this opportunity to co-create strategies with business leaders. “This recession is an excellent opportunity to innovate, as it is relatively easier to get quality time from business leaders, and look at how IT can be used to build competitiveness,” says he.

While the recession has certainly affected the budgets, some CIOs believe that irrespective of a recession, the business requirements must be the only criterion for taking a decision. Cautions Arvind Tawde, Mahindra and Mahindra's Senior VP and CIO,“CIOs must avoid making knee-jerk decisions. Business value must be the only barometer for any investment in IT.” Tawde believes that continued investments in IT will ensure that organizations are ready to take advantage of any upturn, whenever it happens.

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