Saturday, May 23, 2009

Citigroup Dreams About IT Savings

Citigroup (C) through an article in the Financial Times and Deal Book let it be known that they think they can save $1Billion by integrating IT. Sounds great. But as anyone knows IT integration comes with a huge price tag. Compelling as it sounds IT integration is fraught with operating difficulties. There are many good reasons why companies such as Citi avoided doing it. They wanted to avoid the risk as well as the costs. Citi is on its hands and knees and needs to raise capital, reduce toxic assets and sell off parts of the corporate body. When they look at the price tag of IT integration I am not sure they will be able to put their finger on where the $1 Billion is coming from and when.