CFO IT Analysis Competitive Market Opportunities 2008

The competitive market opportunity and risk to any enterprise organization comes from outside that organization. There are market forces represented by customers, technologies, outsourcers external to the organization that need to be managed as well as possible. IT iterations are used to be responsive to these market forces, creating new value based on automation of business process that permits offering quality products and services. CIOs understand how to create the enterprise market positioning via automated process responsive to direction from the CEO and the Board of Directors.

The CFO ability to manage IT cost forces inside the organization has been limited. For good reason does the CFO eschew controlling or implementing micro management of IT spending. The decisions are complex and the risk of failure high because mistakes in judgment can destroy the enterprise. The CIO comes with special experience and training that is very specialized.

IT is a world of its own. But, ...... Changes in the market warrant CFOs taking a new look at IT decision making process because the cost structures have become so dramatically differentiated. Now it is possible for the CFO to take a high level look at the cost of a distributed server data centers vs. the cost of System z implementations, because the costs are different by a factor of 10. IBM has just eliminated its distributed data centers and moved to a mainframe centric architecture for IT. This represents a dramatic change in the industry driven by the IBM CFO predictions of the impact of rising energy costs on distributed data center operations.

Server vendors adapt business strategy to focus on real time exchange of information on enterprise networks and the Internet. Network computer systems hardware leverages integration and messaging software. Network storage systems are adapting to the Internet. SOA provides significant advantage to the mainframe because operating costs are lower and actual costs can be managed with creative financing packages.

CFOs have positioned to help implement business strategy relative to real time exchange of information. Enterprise networks are built on data centers that leverage the Internet. A focus on network computer systems hardware has hidden the need to leverage shared workload and integration of applications. Messaging software renamed as ESBs supports exchange of information over the network. Network storage systems are adapting to the Internet.

System z acts as a consolidated server technology enabling implementation of network solutions in a shared workload environment that attacks cost and complexity, accelerates service delivery, and provides mobility with security. Shared workload analysis looks at core elements of server business strategy. Decisions based on shared workload include provision for end-to-end architecture that extends technology across scalable processor architectures.

The cost of electricity and infrastructure are central aspects of CFO analysis. With the costs of electricity skyrocketing, and the availability of electricity questionable, CFOs worldwide are looking at alternatives to sprawling, expensive data centers full of distributed servers.

Open systems technology implementation and is being combined with Linux-based application products hosted on System z.

IBM financing can lower the out of pocket cost of technology acquisition. Financing immediately frees cash that would be tied up in computers to invest in the core business. Investment in the core business matters. IBM financing group will take a trade in on almost anything.

IBM financing packages are each unique. They take into account the trade in, the hardware, the software and services that need to be financed in the context of what interest rate is available for this financing. Sometimes, using a refresh approach to upgrading a mainframe means that the payments for the new unit go down This is due to the fact that in refreshing and old box to have the capacity of the new System z10, there is a higher trade in value at the end of the lease cycle and the cost is less, because the value is more.