Do you have a goal for reducing the % of non-discretionary spend?
The key questions to ask are – Does your CIO have a goal for reducing the % of non-discretionary spend? Is there an improvement on this goal year-on-year? How are you improving this? Is it through pure cost / labor/ resource arbitrage or through “engineering” methods?
I would think that reduction in the cost through labor / resource arbitrage is easy and many organizations have achieved. Organizations that are focusing on improving this through engineering methods will tend to achieve competitive advantage due to operational efficiency as well as market differentiation. When I say engineering methods, I mean improvement in process, technology, system and application capability. These methods will have a significant impact on the business. Business leaders would be willing to spend money on these initiatives.
Where does your organization stand today on this aspect?
