Stop Blaming IT For Problems

from the blame-blame-blame dept

One of the things that has struck me as amusing the past few years is the laser-like focus investors and management now has on “cutting costs”. During the boom time, no one gave a damn about costs, and the focus was all on “increasing revenue”. At what point do people realize that the equation balances? That’s why it’s call the cost-benefit equation, and focusing only on one side does a lot of damage. Cutting costs that hurt your revenues even more is no good. Bringing in revenue that costs you more than that revenue is no good. Balancing the two is what a business needs to do. You spend money if it’s likely to bring in more revenue. You cut costs if the corresponding decrease in benefit isn’t as much. For example, suddenly, many companies are looking at technology infrastructure as a cost that needs to be cut. In doing so, they often ignore the benefits that the technology brings. Thus, they end up “cutting costs”, and hurting the company in doing so. Any company that only looks at one side of the cost-benefit equation is unlikely to stay in business very long.

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