Cost Cuts and Prioritization

It is easy to kill will for doing something new and innovative especially in IT industry. All that needs to be done after projects were shaped, defined, and specified is to ask for prioritization of projects. In other words, which projects have to be abandoned, temporarily or permanently? 

Of course it does not make sense to make all requests that business requires and that projects can be done at once but in sequences depending on importance. Scale of importance is usually made according to business value generation. Which projects bring more business values in form of short-term and long-term profit. It is not only criteria but off course the most important one.

Well, after first cycle is made and priorities were attached to many projects, resulting project list will be result with precise timing of delivery of requests. In other words requests were leveled and according to importance will be implemented.

Here comes the catch, after first filter of projects usually comes another one in form of cost cut. Non-planned cost cuts are becoming more like rules in turbulent dynamic markets and industries were changes are significant on monthly basis. So, cost cut is something predictable and for certain projects,  with built-in reserves and that are already approved in budgets, it is “easy” to sacrifice part of budget in cost cut process.

What kills innovation in company are cost cut cycles that happen more than once and that are highly unpredictable. This is what kills any positive creative force of company. Creative force is forced to defend from beginning positive values that could be provided and complete process becomes more like administrative trap where creation is forced to fulfill endless tables and lists.

Reprioritization process caused by cost cuts is becoming more like battleground and additional burden for initiators instead of something that will bring competitive advantage to company. It seems that creating benefit requires more negotiation and tactical skills instead of applied innovation on business… 

Just imagine Business Intelligence architect negotiating for Business Intelligence cubes, data transfers, information flow repairs and upgrades against marketing and sales projects. It is lost negotiating power from the beginning because it is always more important to launch new service or product compared to powerful analytics. It is lost game from the start. That is the reason why repeated cost cut so easy destroys IT creation.

BI architects need to be prepared for cost cut Armageddon in advance, and to make many escape strategies. Unfortunately it is the hard way not to fall in despair and to lose creativity.