Five Outside-the-box Ways to Cut IT Costs

The best time to consider cost-saving measures is before the CFO comes knocking on your door to ask – or demand – that IT slash its budget. A recent article on Yahoo looked at alternate ways to deal with such demands:

1. Harness consumer technologies

Plenty of IT shops are wrestling with how — or whether — to fit consumer and Web 2.0 technologies into the enterprise, says Peter Blatman, a principal in Deloitte Consulting. But some are already making it work to their advantage (…) The cost avoidance of not having to train people on new technologies is just one of the areas in which companies can save. “Although the ROI of using consumer technologies is not always clear on an individual basis, when taken as an aggregate, the savings can add up,” says Sean Rhody, a principal in Capgemini’s technology transformation practice.

2. Get the business side to scope projects

IT shops all too often shoulder much of the responsibility for investigating technology projects, and even though the proposals come from the business, the cost of scoping projects, conducting research, reviewing architectures, evaluating the requisite technologies, and other information gathering inevitably fall on the IT shop, constituting a significant burden that can eat up weeks of work for each potential initiative, Rhody says (…).

3. Use open source networking

Open source is a well-known approach for reducing software spend, but if there’s one largely enterprise infrastructure area that’s ripe for reaping cost-savings by tapping open source, it’s the network itself (…) An ancillary approach (…) for those companies that have a couple dozen Cisco switches and corresponding SmartNet support is to buy an extra switch, set it on a shelf, then cancel those support subscriptions. “If one fails, replace it with the spare, and buy another spare” (…).

4. Hold off on Windows Vista

Economic downturn or not, many enterprise IT shops are already delaying Windows Vista adoption — and an uncertain future makes pushing back the new OS all the more alluring. According to a July report from Forrester Research, fewer than 1 in 11 PCs within large enterprise are actually running Windows Vista, so it follows that of the 50,000 enterprise customers surveyed, 87.1 percent were still running XP as of June’s end.

Countless well-documented reasons to stick with Windows XP exist. Chief among those: Vista’s lack of compelling value and poor performance, coupled with the resurgence of Windows XP, thanks to years of updates and patches that make XP more stable and secure than Vista. Plus, most enterprises need to replace their PCs to be able to run Vista, making the upgrade cost very high (…).

5. Bring in the CFO

Asking the chief of finance to help prioritize can offer a window into the business priorities, so IT can better understand the larger view of projects and adjust its own efforts accordingly. “The CFO can say, ‘It makes sense to cut over there,’ because another department is undergoing an initiative that aligns with that,” says Amy Wohl, president of Wohl Associates.

What’s more, when the CFO goes around to a company’s business units looking for places to cut, an opportunity arises to prove what IT executives already know: IT is uniquely positioned because an incremental investment can result in more than commensurate return, according to Deloitte’s Blatman.

Read the full article »

Related Articles