NEW YORK—The IT function could be the leading factor in pulling the economy out of its slump, according to the chief information officers at some of the nations leading institutions.
At the Society for Information Managements CIO Forum here Wednesday, CIOs offered advice on cutting costs and generating revenues to help enterprises steer their way through tough economic conditions.
Shelley Leibowitz, managing director and CIO at Morgan Stanley, said that for 2003, key issues for the enterprises include heightened risk management, new opportunities, regulations and increased oversight coming out of the Sept. 11 terrorist attacks.
IT can play an important role in helping the economy pick up "because IT is all about productivity. Your technology strategy is critical," said Leibowitz
Leibowitz, like other CIOs at the event, said outsourcing could be a positive presence for enterprises. Yet, she said, Morgan Stanley does "as much co-sourcing as outsourcing, meaning we dont completely let go." Some of the activities her group has outsourced include data center maintenance and monitoring, quality assurance, legacy system support and some development.
One criterion Morgan Stanley uses is, "if its a function that transcends financial services, its a great candidate for outsourcing," she said.
James Noble, vice president and CIO of Phillip Morris Companies Inc., said his company follows a shared service model, where the companys IT organization maintains the "company store," where Phillip Morris various departments can buy their IT products and services.
"If you get a shared services organization right, youll be saving between 10 percent and 30 percent of your annual IT spending," he said. However, he advised organizations not to try to grow just by squeezing costs out of IT.
Noble, who also has been CIO of AOL Time Warner and General Motors, among others said the fastest way to get a successful shared service organization going is to engage in a venture with a partner.
"Ive lived through all the models and I was looking for a better way," he said.