By Bob Violino

Rapidly changing business priorities, fast-shrinking budgets, burgeoning security threats and regulatory overload. For many CIOs, that may sound like a nightmare. But for those in finance, it's all in a day's work.

Yet CIOs in financial services aren't battling these challenges unarmed. They have a new aid: Lean principles — created to eliminate waste and improve efficiencies in manufacturing — that can be applied to IT management and operations. Companies can achieve Lean IT through key technologies and delivery mechanisms.

By building Lean IT organizations, many finance CIOs find they can transform IT architectures, reduce costs and increase support for both the business and its customers. "It's more important than ever for financial-industry CIOs to find ways to cut costs and be more efficient," says David Potterton, VP of Global Research at Financial Insights, a unit of Framingham, Mass.-based financial services research firm IDC. "The financial crisis has hit financial services particularly hard, so achieving greater IT efficiency is that much more important."

IT departments at financial services firms face pressure in numerous areas, including optimizing resources, improving performance and increasing availability, explains Shaena Heintz, Director of Global Financial Services at CA. CIOs have also been tasked with ensuring compliance with numerous new regulations, and they are responsible for ensuring that the end-user experience is safe and trusted. "All of this comes at a time where there is ever-increasing internal demand for IT services, and a rapidly changing environment, often fueled by mergers and acquisitions," Heintz says.

Achieving Lean IT can pay off for financial services firms. Raymond James Financial Inc., a provider of financial services to individuals, businesses and municipalities through its subsidiaries, has launched several initiatives — and is seeing results. "We studied Toyota's manufacturing methodology closely, and took some of the constructs they use to build cars and applied them to our solutions framework for building software," says Mark Abbott, the company's Senior VP of Strategy and Technology Alignment. One result is that Abbott and his colleagues have assigned a "team of peers" to each project. Not a traditional hierarchy, it is instead a group of peers using a structured decision-making process to deliver solutions.