In a good economic climate, it is easy to increase spend on IT infrastructure and development, as the costs of inefficiencies are hidden by large revenue.
However, when your revenue stream is challenged, costs need to be cut. As a CIO operating in today's economic climate, you are tasked to achieve the impossible - cut costs and increase delivery.
Thus, the main question arises:
How do CIOs bring in projects in time and under budget?
Do they cut back on people?
The upside of this cost-cutting strategy is that it is a simple way to reduce your overheads. However, you cannot ignore the fact that not only do you risk the best resources going first, but the instability, shock to culture and market perception of weakness can make recovery extremely challenging.
Do you cut back on infrastructure spend?
A fairly substantial cost cut to infrastructure spend can easily bring down your IT budget. But what will the impact be to your growth objectives? This must be carefully weighed and realistically acknowledged.
Do you cut back on development spend?
Cutting development spend will certainly reduce costs, but at the same time it will reduce delivery and result in you risking loss of market share.
So what is the solution?
The short and long-term answer is to focus on time because in IT, time is money. One of the major factors that tend to abuse time is rework. Rework causes budgets to be pushed out and IT to be perceived as a money waster. A clear indication for any CIO to gauge the amount of money wasted on a project would be to ask the question, how much of rework are we doing? How is rework calculated? By the amount of defects you have in production.
For example, you may have budgeted to spend R50 000 per week on a project. The project was estimated to take six weeks. This means that your total budget for the project would be R300 000. However, during week seven you realise that you have defects in production. How many defects, the severity of the defects and the time taken to fix the defects and stabilise your system would give you a clear indication of the rework and the extra money wasted on the project. If stabilisation takes you two weeks, this would mean an excess spend of R100 000 or 30% wastage, which puts a dent in the budget and image of the CIO and his department, let alone the reputational damage to the organisation as a result of high severity defects.
So how does a CIO prevent defects in production and bring in his projects in time and under budget?
The initial project planning must include the quality assurance stage gates through the life cycle of the project. On average the cost of fixing a defect in your live environment is up to 70 times more expensive then the cost of fixing the defect early in your development life cycle.
These stage gates allow you optimum utilisation of your people, processes and technologies.
The SQA Maturity Model is a tool utilised by leading CIOs to measure, monitor and eliminate the release of defects into their production environments, resulting in substantial time and budget savings.
This cost-saving tool has proved its worth in the retail banking, investment banking, telecoms and insurance sectors.
By utilising this powerful tool and reaping its benefits, true leaders can differentiate themselves in this harsh economic environment.
For more information, contact Sadiyya@testingsolutions.co.za
Please visit http://www.testingsolutions.co.za
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