The moment of truth has arrived for the Indian CIO. Unlike earlier, when the demand was robust, and the CIO was busy expanding the IT infrastructure to support business needs, the tide has ebbed today. In most organizations, IT budgets have been slashed by more than 50 percent, while expectations have doubled. CIOs are being asked to devise strategies to not only reduce operating costs, but to devise ways to lead business growth. Can IT deliver? How can IT cut operational costs, without sacrificing the efficiency of the business? How do CIOs identify projects that deliver returns quickly?

Answers to several such thought provoking questions were discussed and debated in an enthralling session of the first ‘Smart Enterprise Exchange,’ an event hosted by United Business Media and Smart Enterprise magazine in conjunction with CA. The event, held in Bangalore, focused on leveraging the power of ‘Lean IT’ to transform business.

Popular in the manufacturing sector, lean techniques can be used effectively for reducing or eliminating waste from IT powered business processes. Lean principles can be used very effectively across not only customer-focused business processes, but also for pure IT processes such as software development and server provisioning. The event lived up to expectations and highlighted several practical ways on how IT can be leveraged to boost efficiencies.

Small sources make a million
Several noteworthy speakers and senior IT leaders attended the event moderated by Val Souza, Editorial Director, UBM India. The event began with a thought provoking keynote from Professor Sadagopan, Founder Director of the International Institute of Information Technology, Bangalore. Professor Sadagopan is one of the most well-known thought leaders in our country today.

Describing today’s environment as one with falling budgets, rising energy costs, and “demanding more value” customers, Professor Sadagopan advised CIOs to look at saving millions in several small projects, instead of one big saving of a million from a single project. For instance, instead of looking only at the data center to reduce costs, organizations can look for savings that can be gained from the entire ecosystem comprising software, customer equipment (desktops, laptops, smart phones) and services.

The power of deriving millions from cutting costs across the enterprise was best demonstrated by Kenny Kesar, Vice President, Wipro Technologies. Kesar demonstrated how, by using a unified communication infrastructure, the firm has been able to save millions in travel-related costs, and simultaneously achieve a significant improvement in resource utilization. Thanks to technology, Wipro has been able to save close to 100 trips per year for piloted projects, with approximate savings of USD 2.5 million. This is a true transformation, and has helped the firm to not only increase utilization, but more importantly, has paved the way for a new model.

Why can’t IT be like Ishant Sharma?
As a fast bowler, pacer Ishant Sharma has possibly the best possible return on investment, capturing over 52 wickets from 18 tests, at an economy rate of just 3.19 runs per wicket. Lean IT expert and CA advisor, Peter Waterhouse, used this beautiful analogy to explain the concept of ‘Lean’: “Heritage impedes innovation,” said Waterhouse, highlighting that most of the time IT executives are consumed in running the IT operations, rather than taking strategic IT decisions.

Waterhouse urged IT executives to connect with business using the language of business, rather than using technical jargon. For instance, when the IT function says something like, “Our help desk staff answered Y issues within 30 minutes,” or “Last month’s network availability exceeded 99.25 percent,” this is not vocabulary that the business can connect with immediately.

In a tough economic environment, the business wants answers to questions such as, “How can we quickly enable new products and services?”,  “How can we penetrate new markets?” and “Where can we cut costs without compromising the business?” IT must be prepared to provide proactive responses to such questions.

Waterhouse explained with practical examples how a Lean IT approach can help organizations focus on what is important and deliver the right value to their customers. In this context, organizations can use automated tools and solutions to take the path shown by Lean IT. For example, change and configuration management tools can be used to reduce unplanned outages and service defects that are created due to unauthorized and unplanned changes. Similarly, server and data center sprawl from unused or idle computing capacity can be reduced significantly through data center automation. Lean IT is not only about cost, but also about innovation. For example, unused employee knowledge can be captured and used to significantly reduce the time taken to handle service requests.

Use the current economic climate to reengineer processes
The recession is a great time to redesign inefficient processes and liberate precious cash. In this context, N Nataraj, CIO, Hexaware Limited, said that the current recessionary period was perhaps the best time for organizations to look at redesigning the IT architecture, and showcasing the true potential of IT to lead business growth.

Similarly, V Balakrishnan, CIO, Polaris Software, gave a simple but extremely effective technique on putting more responsibility on business users to own the IT function. Stressing the need of having no separate IT budget for the entire organization, Balakrishnan said that IT expenses must be shared by the respective business owners. For instance, a project for say, a customer facing function, must be quantified by the amount of revenues that it can generate due to the automation and increased efficiency of the process. This mechanism forces the business to collaborate with IT for success and take on more responsibility.

Amit Chatterjee, Managing Director, CA, spoke of the need to look at IT as a service. Chatterjee said that the real value of IT lies in the transformation of business, and IT must look at every possible way to automate activities, so that more time and money can be available for strategic initiatives. He suggested the use of solutions that use the ITIL v3 framework, that covers every possible business function for enabling the IT function to truly align IT with the business.

IT is truly a catalyst for growth. In this context, the event concluded that Lean IT is a great methodology that organizations must use today to cut waste, improve productivity levels, and more importantly, use IT to further business goals in the most efficient ways possible.