Information technology (IT) organizations face a cruel world today. On one hand, there is relentless pressure to cut costs; on the other, an unending demand for innovative solutions. Like Odysseus' band of sailors who had to steer between the two perils of Scylla and Charybdis, IT organizations must steer a middle course. However, they face a situation much worse than the one that threatened the Greeks. Odysseus merely had to avoid either fate, but IT organizations must satisfy both! Put in more contemporary terms, like Miller Lite beer, which promises to be both less filling and taste great, to succeed today, IT must both cut costs and deliver innovation.

The pressure to cut costs stems from several factors. Over the past four years, ...

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