IT Cost reduction
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The document discusses strategies for IT cost reduction amid economic downturns, focusing on optimizing resources and enhancing efficiency through business and software analytics. It outlines three phases for organizations to minimize spending, optimize for efficiency, and drive business innovation, emphasizing the importance of rationalizing software licenses, decommissioning unused applications, and consolidating systems. Additionally, it highlights the role of big data in creating new business models and improving productivity.
IT Cost reduction
- 1. Helping our customers To do more with less Business Analytics | Software Analytics | Application Transformation IT cost reduction It’s all about maximizing your resources
- 2. Amid the economic downturn, companies are searching for every opportunity to cut costs. IT represents an important part of total spending and its direct contribution to revenues and profits is often difficult to assess. Business Analytics | Software Analytics | Application Transformation * Traditionally, a business that has its own IT facility visualizes it as a cost center, since does not generate direct profits. 33% 29% 10% 6% 2% 20% Service Provider * Cost Center Another unit of business Business Accelerator None of the above Technology Associate HOW DO OTHER AREAS OF AN ORGANIZATION PERCEIVE THE IT AREA?
- 3. Business Analytics | Software Analytics | Application Transformation Cost reduction often begins with IT. Frequently viewed as a significant cost, yet at the same time expected to deliver technology that transforms how business operates, IT cost reductions id becoming more challenging than ever, CIO’s have typically exhausted and quick savings. But ending substantial savings isn’t easy. Many CIOs have already spent years reducing costs in operations, procurement and outsourcing services. Sprita iT has identified three phases of IT cost reduction to help organizations reduce cost while increasing the benefit that It can deliver overall business. Minimize spend Optimize for efficiency Business innovation § Rationalize software licenses § Cancel noncompliant projects § Decommission never-used applications § Consolidate databases § Reduce interface complexity § Consolidate systems that do similar things 3 to 9 months 12 to 18 months > 1 year 1 2 3 § Innovate new business models, products and services
- 4. Minimize spend Business Analytics | Software Analytics | Application Transformation Rationalize software licenses. An inventory of licenses should uncover idle, underused, and even incorrect ones. When business managers participate in the review, CIOs can determine how many licenses are truly necessary, retire those that aren’t, and then negotiate deeper discounts by consolidating licenses. Decommission little- or never-used applications. Candidates for retirement include business applications that have rarely or never been used over the past year. Different approaches may be required: depending on usage and need, some may be retired immediately, others replaced by newer applications, and still others phased out gradually. Cancel noncompliant projects. An assessment of the degree to which ongoing projects support both the business and IT strategies can reveal candidates for continuing support, revision, or termination.
- 5. Optimize for efficiency Business Analytics | Software Analytics | Application Transformation Reduce applications complexity. An IT staff can spend as much as 30% of its development time on applications making all of their interfaces work, largely because customized applications have so many point-to-point interfaces. Consolidate systems that do similar things. Different business units in the same company often have their own versions of essential systems, such as payments and Internet applications. Consolidating these systems at the corporate level can bring substantial savings and make processes simpler and more efficient. Encourage reuse. Too many companies spend precious IT resources reinventing the wheel. A serious review of the existing project portfolio will probably uncover a number of opportunities to reuse existing solutions and build a common repository of services and solutions.
- 6. Business innovation IT as business enabler. In times of crisis, companies must consider transforming or even completely reinventing themselves. IT can play a central role in implementing big changes in the way they operate and bring products or services to market. Shape the future. New tools and processes can accelerate product development, and profitable niches in declining markets, and increase productivity. Big data. Innovating new business models, products, and services Big data enables companies to create new products and services, enhance existing ones, and invent entirely new business models. Business Analytics | Software Analytics | Application Transformation
- 7. Sprita iT is an IT consulting, technology services and solutions company. We are committed to delivering results and innovation, by collaborating with our clients to help them in the efficient use of their technology and resources. For more information contact us: info@sprita-it.com www.sprita-it.com Business Analytics | Software Analytics | Application Transformation