Tuesday, January 27, 2009

Just-In-Time IT Budgeting

EMC's chairman coined a new term today that is both accurate and catchy enough to really spread. When describing the difficulty of forecasting 2009 results, Mr. Tucci said that IT budgets really don't exist right now. Every project is being approved on a one-off basis or as he calls it "Just-In-Time" IT budgeting.

The term "Just-In-Time" holds a special place in my heart as operations management was one of my majors in college. The idea of improved efficiency through shortened lead-times and smaller inventories is a prudent business practice, especially in these tough economic times.

However, while this may be a prudent approach for many companies, I think this will be especially painful for many IT companies that have never experienced such the uneven demand curve that Just-In-Time purchasing creates.

Expect to hear more about this theme in the months ahead.


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