2020 has been an eventful year, it goes without saying. The global pandemic will be a discussion point for years to come. It has affected every aspect of our being and businesses have been hit hard. Figuring out where operational spikes are in any business can be a daunting task. With so many aspects of a department drawing down on annual budgets, it’s very easy to run on empty only to find the department was nowhere near as efficient as it could have been. If you are an I&O leader, this scenario plays like a seasoned vinyl track. Add a global pandemic to the list and you have your work cut out for you.
Gartner released its latest worldwide IT growth estimates, in which the market is expected to be worth $3.5 trillion by the end of the year, in comparison to roughly $3.8 trillion in 2019.
In addition to the complete shut down of many businesses, that projected decline speaks to cost management measures that obviously need to happen given the current state of affairs. The first order of business is to be able to fully identify where the greatest spending is and how best to manage or completely stop it. The following pain points are the first focus areas that we recommend any leader considers, especially in an IT department.
1.Hardware & Infrastructure purchases
Whether planning for the physical infrastructure to be housed on premise or hosted in a co-location facility, this is always the biggest withdrawal from an IT budget. The exercise of planning for data workloads and the required physical hardware normally sees overcompensated purchases taking place. While budgeting for a rainy day is always a good idea, in certain instances it can be unnecessary expenditure of funds that can be utilized elsewhere. It’s important to critically assess what you have in your environment and what is realistically needed. Infrastructure decommissioning, or reassigning, can save much needed dollars. However, in order to adapt to our new normal work from home setups, virtual conferences, and remote operations, some firms have also needed to invest more money in new equipment and services. Having a tool that provides a transparent view into all hardware and infrastructure costs and usage helps ensure you’re only paying for what you truly need. Some tools have been developed to calculate your current usage pitted against your total inventory and by seeing what can be optimized and decommissioned, massive cost savings are realized.
2. Underutilized and over-provisioned licenses
The heading speaks for itself. Most organizations purchase more licenses than they actually need or ever use in any given year. The bigger the enterprise, the greater the chances of the IT department spending more than they should on OS licensing. Many assessment reports have generated massive cost saving options in this particular area. If you’re not proactively managing and tracking active licenses, you’re leaving savings on the table. The best kind of optimization and digital transformation tools should carry customer-centric functionality to help you achieve cost savings immediately and over time.
3. Manual, disjointed IT processes. Automation is the solution.
Many organizations have processes that are not properly documented and yet are critical to the overall functionality and efficiency of the department and organization as a whole. With workforce turnover, some of these processes get lost in translation and needless to say, after a while, the ship stops sailing smoothly. Automation can save money and leave the workforce free to specialize in critical areas making room for innovative ideas.
For example when working with an active directory, processes like on-boarding, off-boarding, group memberships and disabling inactive user accounts are all processes that can be automated, freeing up valuable time for your workforce to work on more pressing tasks.
4. Outsourcing
Relying on under-skilled internal teams to manage niche projects like migrations can lead to business inefficiencies. The cost benefit analysis will prove that the time lost costs your business more than it would for you to contract out these projects. Outsource, where possible, to specialized service providers with the requisite expertise for specific projects or ongoing services. It might seem like a hefty one-off bill, especially if project based, but long term it can save you money compared to the cost of human hours trying to execute projects that your workforce is not qualified to be performing.
Outsourcing, delegation, systemization, and automation allow you to take low-level tasks off your plate and begin leveraging technology and personnel so you can focus on the most important aspects of your business. By focusing on these areas, an I&O leader effectively manages and succeeds at delivering massive cost savings that are realized in real-time with great ROI. Nothing beats the efficiency of a well-oiled machine, it will have that bottom line looking healthy and that’s a statement every stakeholder wants to see.
Learn how TFORM’s digital transformation platform can streamline your operational cost planning process and ensure you’re not wasting any money.
