Ways to Cut Overall IT Spending

IT spendingAll too often, accountants and executives see IT as a cost center. Computers aren’t hard to justify, especially when said accountants get speedy workstations or those executives carry sleek ultrabooks on business trips. But server and software upgrades, infrastructure improvements, increased energy costs in the datacenter? These are behind the scenes and just cut into the bottom line.

Of course, IT decision makers realize that those behind-the-scenes expenses are what keep the lights on. New backup hardware or cloud service providers ensure business continuity in a disaster and most of us prefer to replace servers before they die (or before users start complaining about performance). So how can cutting IT spending while still ensuring the uptime and performance that users take for granted? Actually, there are lots of ways.

Use the cloud

The cloud isn’t the solution for every problem facing IT and it doesn’t universally save money in every conceivable use case. However, migrating from on-premise to cloud-based infrastructures has the potential to save money in the long term on several levels. By moving to SaaS models and deploying virtual servers in the cloud instead of a local datacenter, organizations can often reduce

  • Capital expenses,
  • Staffing resources,
  • Energy costs, and
  • Licensing costs.

Outsource it

Outsourcing doesn’t need to be a dirty word. It doesn’t even need to mean sending programming or call center work offshore. Rather, when businesses make use of managed service providers (MSPs) and value-added resellers (VARs), they can often achieve lower costs for better service since these providers specialize in particular products and services and operate at scales businesses usually can’t match. For example, VARs may be able to pass on software discounts while MSPs may be able to provision services very quickly and efficiently. In almost all cases, outsourcing at least reduces aggregate costs since full-time benefited employees required to manage and maintain everything from Exchange to regular backups are very expensive.

Analytics are your friend

You can collect metrics and data on just about anything these days. That includes server and storage utilization, bandwidth consumption, energy usage, and much more. The emerging field of storage analytics, for example, can dramatically reduce the cost of storage by allowing files that are used infrequently (usually about 90% of all files in an enterprise) to be stored on slow, low-cost media while frequently accessed data can be consolidated into high-speed media. If the redundant data pipes for which you spend exorbitant sums every month have 40% of their bandwidth consumed with YouTube and FunnyJunk, it’s time for cheaper pipes and a decent content filter.

Virtualize it

Finally, for all but the smallest organizations, moving to a virtualized infrastructure (whether in the cloud or on-premise, and just at the server level or all the way down to the desktop) can usually save time and money long-term. Virtualization allows resource utilization to be fully optimized, keeping servers humming at much higher (but centrally managed) workloads instead of the 10-30% often seen in standalone servers. Human resource costs can be reduced as well: consolidating servers once spread across individual departments and workgroups can be managed by fewer IT staff if they are consolidated in a virtual environment

These aren’t the only ways that IT can take a chunk out of their overall spend, but they’re especially good examples of ways in which performance and service can actually be improved while lowering costs. Lower costs keep IT in the good graces of the bean counters and, more importantly, allow scarce resources to be devoted to strategic initiatives or critical infrastructure rather than underutilized or wasted resources.

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Chris Dawson is a writer, speaker, and analyst with particular interests in educational technology, healthcare IT, and the intersection of the two with the cloud and BI. He is a contributing editor at ZDNet, Ziff Davis, and UBM Channel, and a senior editor at Edukwest. You can follow him on Twitter (@mrdatahs) and Google+ (+Christopher Dawson).


Chris Dawson
Chris Dawson is a freelance writer, consultant, and policy advocate with 20 years of experience in education, technology, and the intersection of the two.
Chris Dawson
Tags: Business Intelligence,Technology