Evan Kirchheimer, Practice Leader at Ovum, has claimed that CIOs and IT managers should focus more on innovation and less on cost cutting. Speaking at a BT roundtable, Kirchheimer said that too much emphasis is placed on cost reduction when firms are renewing contacts.

Kirchheimer said: “What I find most frustrating, as an analyst who specialises in enterprise IT, is how CIOs relentlessly focus on cost reduction in every contract renewal cycle. I think that this chokes both innovation and blue sky thinking.”

However, the claim has been disputed by IT chiefs, who argue that while innovation is important, cost reduction is still a priority in the current climate. Kurt Frary, ICT Architecture Manager at Norfolk County Council, commented: “It’s not an option for us to not focus on cost. It would be wrong to say it is an option. I think that anytime we look at any of our major contracts, and our contract with BT for voice and data is one of our biggest, we will be looking for significant cost reductions when it comes to renewal.”