News that Transport for London hopes to save £400m by restructuring its IT systems may be seen by many as a good thing; a step in the right direction. But then again, allowing back office functions to become so stodgy in the first place that an initiative can quite quickly find £400m worth of savings, is not something any organisation should be especially proud of.
Announcing the IT restructuring last week, a TfL spokesperson said: “TfL has identified £2.4bn of efficiency savings that will be delivered through ‘delayering’ management, eliminating duplication, reducing headcount and improving technology.”
“The changes are focused on support and non-operational functions, including, among many other areas, our IT activities, so that we continue to improve our passenger services whilst we deliver this massive investment programme. Around IT, TfL will be consolidating its budgets and delivering £400m in savings over the plan period,” the spokesperson said.
You might think that most of the automation and process optimisation that could be wrung from back office functions would have been wrung from them by now. Seemingly not…[click continue reading for more on this entry]…
As Alan Smith, SVP at workload automation vendor UC4 puts it, “With the global credit crunch squeezing IT budgets, isn’t it time organisations moved away from revenue draining bloated business models?”
“Large organisations like TfL can benefit greatly from often overlooked efficiency savings through automating and optimising back office processes,” says Smith. “Adopting a lean business model by scrapping unnecessary manual interactions between end-users and core IM (information management) systems, businesses can speed up information flow and mitigate business risk by reducing errors.”
Smith concludes: “For many IT staff looking to improve efficiency and reduce IT spend in 2009, automation will be a welcome, cost-effective resolution for the New Year.”
The ‘£400m saving’ may have launched a flotilla of positive headlines for TfL. But sadly, it is precisely because back office IT functions have been able to become so inefficient that organisations like TfL are able to find significant cost savings relatively quickly.
As the recession bites, the lesson for companies in 2009 might perhaps be that ongoing, hands-on monitoring and optimisation of back office IT systems could drive even better efficiency improvements in the long run, and see less wastage in the short term to boot.