Survey Results Show Business Leaders Looking for IT to Drive Revenue Growth

According to Mark McDonald, Gartner’s Executive Programs group vice president, organizations trying to grow [today] are missing two, crucial technologies:

• New lighter-weight technologies — such as cloud computing, software as a service (SaaS), and social networks, and
• IT models enabling the CIO to redefine IT, giving it a greater focus on growth and strategic impact.

It’s great to talk about new technologies, but…

• Who in your organization will vet them?  
• How do you know the technology you choose is the best and most secure choice?
• Which should you choose, a SaaS solution or a hosted one?  What’s the difference?  
• How will it work with everything else?
• When will your IT group get to doing it?

Your competition has already put the problems of selection, implementation and integration behind them — and they’re using these new technologies against you today.

The New Normal:
Opex instead of Capex

Today’s CIO is confronted with a shift in thinking about expenses: look for ways to move expenses from the Capital Expenditure (Capex) budget to the Operational Expenditure (Opex) budget.

The Chief Financial Officer will look at ways to spread large costs over time to take advantage of amortization and depreciation.  CFO's manage those expenses separate from the day-to-day operational expenses of the organization.  Generally, big-ticket items like telephone systems, servers, software and, in some cases software development resource costs for products or internal application development, are capitalized.  The Capex budget is determined annually, and investments made against it become locked in.  Capital expenditures also appear on the Balance Sheet.

In contrast, the Opex budget is used for the day-to-day costs of running the business and are managed on a monthly basis.  These expenses appear on the Income Statement simply as "operating expenses".  These expenses fluctuate with the business and can go up or down from month to month.  Examples include rent, utilities, payroll, and other expenses the are typically paid monthly.

CIO's must do two things at the same time: manage expenses and deliver high-quality, high-availability and robust applications for the business to grow.  How you manage this balance will define you in the organization.  Add in the need to ensure data security, quick response along with integrating software architecture that is getting more complex makes your job both more difficult and harder to translate.