5 Essential IT Cost Reduction Strategies You’re Overlooking

According to Sunny Gupta, CEO of Apptio, “Every CIO has 70-80 percent of their cost structure and IT budget tied into ‘run IT’, or business as usual, with only 20-30 percent focused on innovation.”

Many managers wish that they could divert more of their budget to actually improving things or implementing their great ideas, but it’s so crucial to keep everything running properly that they end up pushing innovation to the back burner.

IT cost reduction strategies can help your company free up time and funds for more strategic work. Here are 10 to get you going!

5 IT Cost Reduction Strategies

While not every strategy will work for every company, you’re nearly certain to find a strategy here that can help your company’s bottom line.

1. Technology Expense Optimization Software

A technology expense management system like Sophia can provide you with a shortcut to bringing your IT expenses down. Sophia lets you identify and resolve problems and find opportunities to lower your technology costs.

Some expenses aren’t useful, like software you’re paying for but not using. These can be dropped to save your company money.

Sophia also provides direct pricing visibility into 55+ technology suppliers so you can compare them to the services you’re currently getting.

Whether by helping you find a cheaper product that’s just as good or by helping you find a more powerful tool to increase your company’s performance, Sophia can help you upgrade your tech game and cut costs at the same time.

2. Managed IT Services

Managed IT services are becoming increasingly popular. In fact, the managed services market is expected to nearly double from 2017 to 2023.

You can hit two birds with one stone here by saving on cost and also gaining access to cutting edge technological solutions.

Managed IT service companies provide an incredible level of efficiency. While your IT maintenance team may just sit around draining funds even while there are no problems, managed IT services can be called on only when needed.

3. Modernized Network Infrastructure

While modernizing your network infrastructure might sound expensive, it is probably the case that outdated technology is costing you more than you might think. For example, you may have systems that continue to rely on an analog dial tone. These can include fax machines; alarms and fire panels; elevator emergency phones; HVAC systems and lighting controls; 911 access; point systems such as PoS systems, election machines, lottery terminals, etc.; physical security access; and more.

But with analog telephone lines at end-of-life, carriers are raising prices—as much as 5X in some cases. This means these legacy systems are eating up more and more of your resources. Moving to a more modern solution such as 4GLTE can save you money while at the same time giving you advantages like wireless routing and remote monitoring.

4. Outsource Technology Contract Negotiations

Are you sure that you are getting the best possible price for each piece of technology in your organization? In most cases, the people who understand your technology needs and the people who are most skilled at negotiating contracts aren’t the same people. One smart option is to consider a professional services firm with a technology contract negotiation offer. They’ll bring their expertise and knowledge of what others are paying for technology to the table. You can even find services that will only charge you when savings are achieved. You really can’t go wrong.

5. Data Center Co-location

Data centers provide a level of security, continuity, and disaster recovery that is far too costly for most organizations to manage internally. Switching to data center co-location takes the pressure and cost of maintaining equipment, ensuring security, and preparing for unexpected failures off of your team. Another advantage is that your ability to grow is essentially unlimed. When you need more capacity or computing power, it is there waiting for you.

Take Your Company to the Next Level With Cutting Edge IT Techniques

We hope you learned something helpful about IT cost reduction strategies. To learn more about how you can manage your tech and take your company to the next level, please check out these useful resources.