IT departments often face an undue amount of scrutiny, particularly when it comes to their budgets and generally uncovering IT cost reduction strategies. While everyone ends up relying on IT to resolve issues, to prop up technology infrastructure and to (sometimes literally) keep the lights on, they are still expected to cut costs, reign in complexity and basically make all systems run perfectly all the time.
Such goals are naturally a flight of corporate fantasy, but CIOs nevertheless do have some tools at their disposal to appease other decision-makers while ensuring that IT-related operations run smoothly and efficiently. CIOs and other top-level IT decision makers can use the following tips to help meet IT cost management and cost reduction goals while delivering the expected level of service and functionality:
Assess Current Spending and Needs
Despite being given the Herculean task of IT cost management, IT departments are often not backed by the same cost-cutting resources that other departments are granted. IT frequently ends up being left to their own devices when trying to assess current costs on a granular, project and overview level. Yet, measuring expenses with this level of precision and categorization is critical to controlling IT expenses.
Outside analysts like Freedom Profit Recovery can help by working within a minimal budget while precisely measuring every relevant detail of IT expenditures. In Freedom Profit Recovery’s case, that budget is “zero” since our engagement phase comes at no cost to clients. By measuring your expenses and comparing them to your daily use needs, opportunities for cost savings can be more readily identified and the efforts measured over time.
Maximize Value of Existing Equipment
Vendors misleadingly encouraging their clients to throw out “obsolete” hardware, software or network infrastructure can be a major source of IT budget expenses. CIO Insights even identified that 79 percent of organizations believe that wired networking systems should be replaced every five years even though most wiring can easily last 20 years without any performance issues. Also concerning is the fact that 44 percent of IT decision-makers trade in hardware and equipment long before its useful lifespan is depleted. Assess your genuine needs, and entrust neutral parties like Freedom Profit Recovery to steer you towards solutions that benefit you and not some commission-driven huckster.
After assessing your equipment, it is also important to audit electricity consumption. Finding ways to lower energy costs in business can result in a substantial and long-term cost reduction.
Seek Out Managed IT Contracts
One efficient method IT departments can use to scale down their budget without hurting performance is to outsource certain services to vendor contracts. Document output and telecommunications are two areas in particular that can be effectively and cheaply handled by an outside third-party, freeing up IT’s resources to focus on more critical services.
Unfortunately, many of these contracts can get out of hand and end up costing more than they are worth without some needed oversight. Freedom Profit Recovery ensures that all outside service vendors are trustworthy and can deliver dependable ROI without any games or deception. We can even help negotiate favorable rates so that our clients never pay above fair market value.
Take advantage of these capabilities and give your IT budget the flexibility it needs to respond to upcoming disruptions. You can visit our managed cost savings services page to get started.