Daily, we hear about more layoffs and downsizing. Along with this comes scrutiny of all internal budgets including learning and development. Companies are not lopping off learning as drastically as in previous recessions. Companies know that skilled employees make their business successful. But, at the same time, some budget cuts are inevitable. This is where eLearning comes in. Most organizations already have some eLearning but they are not using the full capabilities like the rapid eLearning tools or the virtual classroom from their Web conferencing provider, or the informal learning using collaboration tools like blogs, podcasts, and wikis.
Yes, classroom training will be cut since travel costs are a quick savings. But this doesn’t mean you can’t have effective learning . . . via a different approach! This is good time to take stock of what tools and features you have but haven’t used from your LMS or your online meeting providers and exploit these online synchronous and asynchronous forms of learning.
Recently, I’ve had a number of conversations with CIOs and senior IT staff on the pressures caused by business belt-tightening.
This, of course, has cascaded to IT in the form of the need to cut. Favorite targets: new investments, whether for business-sponsored projects or infrastructure, followed by ‘IT overhead’ – travel, training, IT improvement programs, followed by opportunistic cuts in the operations budget. For most I’ve talked with, they have their budget for 2009, but are still watching for the request for further cuts.
Now, the hard part has started for them. As one said “having less to spend means I need to work harder to make sure it’s spent wisely’. The problem isn’t just one of picking areas to spend on, but also in making sure that the business execs who are getting more involved in these decisions agree it’s being spent wisely.
I constructed this formula to help the conversation. It basically lays out what I call the IT’s ‘cost/capacity/demand’ challenge. Perceived business value is business management’s belief that they are getting good value from overall IT spend. It’s a function of aggregate business demand; not just projects but also tactical requests for application enhancements, or expectations for service quality - spread over available capacity; both staff, external services and infrastructure capacity - at a particular cost. The cost is IT spend, and when spend goes down, capacity goes down.
Last week I was at a dinner with IT execs from several firms. Not surprisingly, we talked about the economy and what it means for their firms and for their IT organizations. I asked them what the economic pressures meant to them, and they said “their business customers realize now that what they ask for has a cost”. One PMO head said that her business partners used to ask for ‘the quickest solution regardless of cost’, and now they are asking ‘the best value solution’. Others echoed this, saying that IT used to be looked at as a ‘magic cookie jar’ which should always have the resources a business area needed – but now business managers understand IT’s finite resources and the need for prioritization.
4/5ths of IT execs say they are re-assessing their IT organization with the intent of finding ways to run leaner. Many of these firms will use a consultancy with a practice in re-engineering IT organizations. And a number of these firms are asking me what they should look out for when they evaluate these consultancies. Why are they asking me this? First, these re-engineering projects cost a lot, 2nd, clients aren’t expert in how to evaluate who’s strong and who’s weak, and 3rd, our clients have one shot at getting these re-structure projects right, and don’t want to pick the wrong firm.
I ask them to drill down three levels into the methodology boxes and arrows charts that they bring to their sales calls.