CIO Driven Research by Digital Fuel Identifies Top IT Cost Management Trends for 2010

Enterprise IT Appears Set for a Rebound in 2010—But Issues Remain. Here are The Top Five Ways IT Cost Management is Impacting the Future of Information Technology

SAN MATEO, CA - (February 2, 2010) - Digital Fuel, the leader in SaaS IT Cost Visibility solutions, today revealed the results of its 2009 end-of-year investigations into the future of IT Cost Management as one of the industry’s most talked-about enterprise disciplines. Based on an independent study of IT Cost Visibility sponsored by the company, and confirmed by its series of multi-city roundtable meetings with CIO-level executives during Q4 of 2009, Digital Fuel sees the following as primary drivers in IT Cost Management:

• As spending pressures mount, CIOs need to find ways to free up money for critical software and hardware investments. One major independent research firm predicts a rebound in global IT spending of 3.2% for 2010, while another is even more robust, anticipating an 8.1% jump. Wherever the needle falls, IT cost managers are looking for ways to assemble the funds to make acquisitions and upgrades that were tabled during the recession. Since new dollars are still hard to come by, the run/maintain budget is high on the list of places to focus—yet costs in this area are difficult to isolate.
• Virtualization and cloud computing are muddying the waters for effective cost management. These two computing paradigms are here to stay, powered by their ability to significantly advance enterprise computing efficiency. Yet along with their advantages comes a vast increase in complexity for tracking and assigning value to IT investments. CIOs will increasingly struggle to optimize and rationalize the investments they place “in the cloud” or into a virtual context.
• The hunt to remove inefficiency didn’t end with the Great Recession. The low hanging fruit was picked long ago. Now, senior IT executives are seeking insights that will reveal where their departments are—and are not—delivering real value. Many have realized that creating an IT service catalog does not by itself drive value. But managers are seeing the need to accurately apportion and map direct and indirect cost drivers to services, a move that will enable them to complete their harvest of productivity and cost efficiency.
• Partnerships with business units are necessary to control costs. IT departments are gradually, and rightly, recasting themselves as service providers to internal and external “customers”, instead of cost centers. In order to better manage their cost of “doing business”, however, partnerships must be forged with the objective of delivering greater value. Senior IT executives are realizing they need to transform their dialogue with these partners, by offering information that is actionable and business-focused instead of IT-focused.
• IT executives are seeking new ways to automate the cost management process. Spreadsheet, project management and even general ledger accounting software, for all their value, are incapable of capturing, tracking, assessing, allocating and analyzing all the direct and indirect costs related to the full range of IT services. Moreover, IT staffs don’t have the time necessary to effectively and accurately manage IT investments manually. As a result, interest in powerful, automated IT Cost Management alternatives is growing at a rapid clip.

“We were very impressed with the consistency of opinion and priorities discovered in our IT Cost Visibility study from last fall, and in our CIO roundtables completed before the end of the year,” said Yisrael Dancziger, President and CEO of Digital Fuel. “Clearly IT Cost Management has become a high priority among senior IT executives. As the trends identified here continue to shape, and be shaped by, IT Cost Management in the new year, we are excited that our SaaS solutions address them so well.”

About Digital Fuel:

Digital Fuel Technologies, Inc., is the leading provider of IT cost visibility solutions including IT Cost Management and Service Level Management (SLM) applications used by enterprises and commercial service providers. The company's business software applications manage billions in IT, telco and other business services at companies and governments around the world including BBC, BT, Capital One, Cisco, Computacenter, CSC, Cummins, Dell, Deutsche Bank, General Electric, Global Crossing, IBM, Nationwide, Nestle, Procter & Gamble, Siemens, SITA, Sprint, Steria, Telefonica, Telus, VW and Wipro. Digital Fuel is headquartered in San Mateo, California, USA, with offices across North America and Europe. Learn more at www.DigitalFuel.com.

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