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How to Reduce IT Infrastructure Costs the Right Way

Feb 27, 2014 6:00:00 AM

by Charles Bystock

how to reduce IT infrastructure costs (2)In our last post, we offered five tips on how to reduce IT infrastructure costs. We noted there are myriad opportunities to curb expenses and gain efficiencies – certainly more than five – and we also noted that how you approach cost cutting can affect the outcomes you achieve. So let’s talk about how to reduce IT infrastructure costs the right way.

Outsource.

Gartner says sourcing is the most strategic decision IT leaders face today, because you have such a wide range of choices. Third-party vendors have the resources, availability and primary mission to perform the work you need done, whether that’s a finite project or ongoing services.

You can pick and choose which components, systems or functions you want to keep in-house and which you want to offload. That enables you to retain absolute control over critical items, if need be. You can retain functions that make the most of IT staff strengths, instead of dragging your skilled people away from priorities to handle tasks someone else could do more efficiently and cost-effectively.

At the same time, you can outsource to multiple vendors, playing off each of their strengths, too. The overall result is an IT environment that serves you best and makes the most financial sense.

Think long-term.

Scalability and flexibility should be your overriding concerns, because without them you don’t have the agility to roll with the marketplace. Focus on overall corporate goals, because immediate and narrowly-targeted cost savings are fine, but IT is an integral part of your company’s ability to perform. Short-sighted “savings” could cost you dearly.

Don’t pay for what you don’t need, but choose changes that guarantee availability when you do need it. Contracts can often be negotiated at lower cost if the term is longer. You’ll also get better consistency, and the longer you work with a provider, the stronger your relationship becomes.

Establish priorities.

Low-hanging fruit is everyone’s favorite. Start with savings that are easiest and cheapest to implement and provide the broadest benefit. You’ll make a giant leap forward in reducing costs, and you’ll demonstrate the kind of success that builds C-suite confidence and that of employees, too.

Defer non-essentials, re-evaluating key initiatives against these three criteria: relevance to a high-priority business initiative that’s a near-term necessity, ability to reduce costs near term and ability to provide upgrades that lower enterprise risk.

Think TCO.  

In the long run, it’s total costs of ownership that counts most. Don’t let indirect or hidden costs or short-term thinking sneak up on you and decimate your efforts to reduce expenses. For specific IT infrastructure projects, travel and other expenses can significantly affect your total outlay. And for transformational decisions that require a reliable business case, you can’t possibly compare alternatives without comparing TCO.

Hire a consultant.

Do this before you do anything else, because the right IT infrastructure consultant can help you understand and implement all the latest best practices, across all aspects of your enterprise-wide IT environment.

Just learning about delivery and vendor alternatives can be a monumental undertaking. And the research doesn’t do you much good unless you also know the real-life implications of each alternative, for your company. The right consultant can apply their up-to-the-minute marketplace knowledge and insight to your decision-making, helping drive the best solutions, whether outsourced or internal.

A consultant will start you off with a comprehensive assessment of your current situation, helping uncover hidden costs you can circumvent by making changes and hidden opportunities to streamline, transform or generate more revenue.

Now you’re armed. You have some proven tips on how to reduce IT infrastructure costs, as well as some advice on how to approach your choices the right way, so you can make the best decisions for your circumstances and goals. Combine them wisely, and you’ll be able to build the strong-but-flexible foundation your company needs to grow and thrive, no matter how unpredictable the future.

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