IT Forecasts, Budgets and Post Audits

No one has kept records of the extra diesel fuel that would have been used or the extra shipments that would have been lost had the new application not been installed.

You may be able to verify that service is better, but how much of the improvement comes from the new trucks, how much comes from the dispatching center, and how much comes from the new application? It is impossible to say. The only way to judge the success or failure of your revitalization program is to examine the delivery business as a whole.

In contrast, developing an ad-hoc application using commercial-off-the-shelf tools may sometimes produce clear-cut benefits that are attributable to the new application alone and result in virtually no down-stream costs once the application is turned over to the end user.

For example, a new optimization tool could

  • Minimize the costs of shipping goods from production plants to stores near metropolitan demand centers, while not exceeding the supply available from each plant and meeting the demand from each metropolitan area.
  • Find the best way to visit 20 cities with the least amount of traveling.
  • The bottom line is, in order to stay competitive, senior management needs to fund IT budgets with a degree of expertise heretofore usually seen only in their funding of core-business budgets.

    Marcia Gulesian has served as software developer, project manager, CTO, and CIO over an eighteen-year career. She is author of well more than 100 feature articles on IT, its economics, and its management.