But the US$600,000 that SMECO pumped into its IT infrastructure investments has had a net positive effect on discretionary project spending. The newer systems have helped push down maintenance costs and free up project funding. And by outsourcing the company's help desk operations last year, SMECO was able to increase end-user support from 50 hours a week to 168 while lowering its help desk costs by 10 percent annually, says Trentacosta.

Now, SMECO is allocating about 32 percent of its annual IT spend to discretionary projects, he says, "and we're trying to drive that up."

Licensed to save

In 2000, IT managers at Burlington Resources Inc. were given an ultimatum by top brass: Cut its geological software licensing costs, or the company would outsource the management of those applications. "It's amazing what kind of motivation that can be," says Dan Shearer, manager of technology enhancement at the Houston-based energy company.

After hiring a consultant to help the company get its arms around its software licensing agreements, IT managers at Burlington Resources discovered that many of its licenses were underused or unused. In 2001, the company began deploying software from Open IT Inc. in Houston to monitor its use of high-end software for global oil and gas exploration.