It’s a big ticket item and very tempting to hack away at, but is this a good time to take a bite out of IT’s budget?

As the economy falters and many companies are looking at belt-tightening strategies, there’s plenty of temptation to trim technology spending. That’s because many organizations look at IT as a cost center rather than considering its profit potential.

But instead of going without in this vital area, the savviest companies approach tough times as an opportunity to spend smarter on IT instead. Some even wind up spending less and increasing efficiency and productivity. Here are four strategies to scale back on IT spending while still keeping pace and making sure your organization isn’t behind the technology curve:

• Hold off on non-critical upgrades. Your IT folks may be used to getting the latest and greatest with every upgrade vendors issue. But are all those new features and minor tweaks really going to enhance your business? And don’t forget about all those additional direct and indirect costs of hardware to support the system and training to get employees up to speed. A better strategy: Figure on getting every other upgrade. This can often get you productivity gains without breaking the bank. Heck, your IT staff will probably welcome a reprieve from training users on new systems — a notorious time sucker and headache.
• Embrace the No. 2. You probably remember the old Avis campaign that boasted “We’re No. 2; we try harder!” The same could be said of software and hardware vendors. Be aware that you’ll pay a hefty price for having the fastest processors or largest monitors. There’s no need to scuttle a purchase altogether. The second- or third- fastest machines are probably more than adequate and they’ll have a price that’s a lot easier to swallow. But you’ll want to remember not to take bargain hunting too far. Ultimately, you get what you pay for. Check out the offering that’s one or two steps below the top-of-the-line model. That’s where you’ll get the best value.
• Know when to explore alternatives. Speaking of value, there’s no better time for your IT folks to prove theirs. Try challenging them to come up with alternatives to traditional system and software solutions. See if they can bring costs down while pulling up efficiency. Two areas they could check out: Virtual technology (instead of loading applications on every PC in the place, you have either have it loaded on the server or let employees access online using “thin clients” — diskless machines) and Open Source Software (often free applications that are light on training and warranties, but can be a real cost saver if you’ve got an IT staff that’s technically competent.)
• Decentralize IT. Decentralizing means taking parts of IT – like software engineers for custom projects or help desk pros – and assigning them directly to a department or business unit. Advantage? IT doesn’t take such a big hit when it’s budget cutting time. IT workers in business units are more closely tied to revenue and so less likely to be viewed as expendable.

Bottom line: Protecting your company’s bottom line and staying current with technology don’t have to be at odds with each other. Making sure IT’s spends smart will go a long way in tough times – which won’t last forever. Average recession duration: 10 months.