The IT budget has turned into sort of a battleground, contested by the fundamental need to simply keep the lights on and the growing imperative to make the organization more innovative. The issue, of course, is that budgets generally have not expanded enough to fully accommodate both sides in their present forms.
Something has to give. A good place to start would be rethinking current approaches to IT infrastructure automation, and starting with inefficient test labs that can be consolidated, automated, and turned into multi-purpose clouds that more efficiently accomplish lights-on testing as well as afford faster, more real-world innovation.
The state of IT budgets going into 2015: Operating costs still loom over the ideal of innovation
Throughout 2014, IT budget growth was nothing to write home about. Last summer, research firm Gartner estimated that global spending on IT might rise roughly 2 percent this year after being flat in 2013.
With flatness the norm, cost reduction becomes a priority. Can the footprint for basic operating expenses be shrunken enough to divert new resources to innovation?
Late last year, the outlook was mixed, with Columbia Business School professor Rita Gunther McGrath observing that at some organizations she had observed up to 90 percent of the budget was allocated to keeping the lights on. Ideally, she argued, no more than half of all expenses would go toward this necessity.
It's probably too optimistic to expect a near-term turnaround in how IT budgets are structured. A 2013 Forrester Research survey of IT executives at 3,700 companies found that overall less than 30 percent of budgets were designated for new projects. Most funds instead had been earmarked for basic maintenance and capacity expansion.
Going into 2015, organizations are looking to invest more in areas such mobile application development, data analytics and cloud computing, but there will be the constant pressure of IT salaries and basic expenses. Usage of SaaS and select hiring practices can only go so far in keeping a lid on, much less reducing, IT spend.
Lab automation as an incubator for savings and IT innovation
Especially for larger IT organizations, development and test labs can be very costly to operate due to manual processes that result in low productivity and poor capital efficiency. It doesn't have to be this way though. Three steps can help turn labs from bywords of waste to models of cloud-like efficiency:
The takeaway: IT budgets aren't growing that rapidly, creating budgetary tension between operating expenses and new projects. Organizations have taken several approaches to striking a better balance between the two sides, such as using SaaS, but there's more to be done. Where dev and test lab costs are manual and inefficient onerous, automation and consolidation is an effective way of enabling DevOps orchestration and freeing up money and productivity for new innovation.