Seven ways to free up money for IT innovation

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When it comes to freeing up money for innovation, CIOs need to be their own strongest budget critic. The Enterprisers Project asked top IT executives to share some of the creative ways they're finding money to spend on new projects. Here's what they said:

1. Resist the next shiny object

Securing buy-in for emerging technology projects from our top business leaders has really helped these projects stay on track. Thanks to our collaboration, both IT and the business are now more disciplined about ignoring shiny objects from vendors, especially in the data space, to ensure that our data strategy is fully defined before making any purchase. - Paul Brady, CIO and Vice President of Information Technoloy, Arbella Insurance

2. Look for savings in basic IT services

Equivalent capability is becoming less expensive. Opportunities abound for IT organizations to naturally reduce their costs for basic IT services such as networking, telephones, computing, and storage. You can take advantage of enterprise software enabled by open source. Don’t expect automatic savings though. It’s important to put plans and programs in place to take advantage of IT services that are becoming easy-to-purchase commodities. Simply putting one release into production won’t be enough. You’ll have to keep improving the solution, keep reducing the cost of the solution, and keep adding new business capability going forward. But if you build all of that into your plan, you can free up IT dollars to spend on other valuable projects. - Lee Congdon, CIO, Red Hat

3. Turn your analytics expert into a venture capitalist

It’s actually a lot cheaper and simpler than you may think to do what I call venture capital probing inside your own company. Your secret weapon is your analytics expert. We tend to think of analytics as only outward-facing. But when you look inside your organization, you’re apt to find a lot of gold waiting to be discovered. By teaming up your analytics officer with the operations side of your organization, you can find some tremendous cost savings in operational processes simply by doing some rapid prototyping.We subscribe to speed in our prototyping at JPL. It’s progress over process, or as we like to say, 'Perfection is the enemy of progress.' When we tie these principles together, we’re able to get data back quickly and identify what’s worth digging into more deeply. We can use our results, those initial analytics, to secure funding for a bigger effort. - Tom Soderstrom, IT Chief Technology Officer, Jet Propulstion Laboratory

4. Outsource to free up time for innovation

With our growth, outsourcing IT functions helps us keep on top of key IT initiatives and manage other department priorities while our infrastructure partners manage capacity and grow our systems as needed. They are in the business of quickly adding new servers, adding new storage and planning for future growth – all items that would be very expensive for Massage Envy Spa to do by itself, without sharing the equipment. Outsourcing allows us to scale and use our outside providers’ existing technology at a cost that fits within our budget. Buying all of the equipment on our own would be very expensive. - Dan Miller, CIO, Massage Envy

5. Retire legacy systems

Start chipping away at legacy systems that are no longer well-suited to purpose. On a relative basis, that old technology just doesn’t get less expensive over time. It probably doesn’t even get less expensive on an absolute basis — just the opposite occurs. And that’s not considering the cost of reduced agility. So as you look to become more agile and responsive to the business, you’ve got to begin funding the retirement of your legacy systems. - Lee Congdon, CIO, Red Hat

6. Conduct strategic planning with the business

When we sit down to build out our three-year strategic plan, we always factor in the underlying IT components that will enable those business capabilities. By baking IT into the plan, we’re able to have more detailed budgeting conversations from the start. This is especially helpful when you find that much of your IT budget is wrapped up in maintaining legacy systems and not building new ones. When those business initiatives come up each fiscal year, no one is caught off guard by the IT investments needed to implement them because we’ve already laid the foundation for it. - Paul Brady, CIO and Vice President of Information Technoloy, Arbella Insurance

7. Know when to pivot and when to persevere

Piloting a new customer experience idea in a small setting – a specific, targeted group of stores, if you’re in retail – is a great way to put a customer experience idea through its paces, particularly if it involves targeting. You get a lot of input quickly to figure out where a technology might make sense and whether it's delivering good results or negligible ones. The key decision point – using the Lean Startup concept – is whether to pivot or persevere. - Peter Buonora, Enterprise Architect, BJ's Wholesale Club

Now that you know where to look for savings, read these ideas for reinvesting them: NetApp CIO: Ideas for reinvesting your IT savings.

As community manager for The Enterprisers Project, Ginny Hamilton helps build the site's community of CIOs, IT leaders, and readers. She is responsible for helping tell the stories of leading IT executives – showcasing the projects, experiences, and challenges they're facing in their roles as IT leaders.

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