Wavestone The IT Leader’s Recession Playbook

In the short term, understand the variable component of the IT budget and bring variable spending down to help the company manage through the revenue trough. / Reassess discretionary projects to determine ‘pause vs. play’ decisions, especially those that use third-party labor. / Reduce volumes of anything being purchased as-a-service (e.g. software licenses, cloud server instances); you can turn volumes back up after the downturn. / Leverage the reduced resource (RRC) terms of managed services contracts, if possible. / Reevaluate contract (staff augmentation) labor. In the longer term, learn from this experience to reengineer the IT cost structure to enable scalability, both up and down, to respond to small and large changes in demand. / Renegotiate contracts to allow significant changes in service volumes and pricing. / Move to flexible services (e.g. cloud services) that can be turned on and off on short notice. / Consider staffing models that keep only the most critical roles in-house and contract for commodity labor.

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