It’s no secret that technology is the key to seamless business operations. This explains the increase in IT needs and spend we have seen over the years. Moreover, a report from Gartner predicts that spend will increase by up to three percent by 2020, and more so thereafter.
Being cost savvy whilst reaping the benefits of technology and infrastructure advances is the ultimate balance Finance Directors across the globe wish for. Is this possible to achieve, you ask? Yes, we say. Keep reading for four key considerations.
Migrate to the Cloud
Migrating your data and applications to the cloud not only saves space in your office environment, but it is also helpful in reducing costs associated with hardware. Eliminating hardware eliminates the maintenance and storage costs that come with it. Just imagine not having to maintain a comms room any more, this means less money spent on electricity and cooling. And, this frees up space in your office environment, or poses the opportunity to downsize (another cost reduction).
Going cloud has many benefits. Another advantage is that your business can adopt a more economic, pay-as-you-go type model. You can say goodbye to purchasing hardware and software in advance, and start paying for it as you need it with the cloud model.
TIP: Migrating to the cloud also provides maximum connectivity for all users at a firm (local or global), and it keeps data synced and available in one place. Migrate to the cloud today, so you are well-prepared and ready for future growth and expansion plans.
Evaluate Third-Party Vendors and Partnerships Regularly
Its good practice to assess any third-party vendors you work with to ensure they are still cost-effective, and to evaluate the quality and relevance of services they provide to your business.
Firms are advised to do this at least once a year, and to compare costs with other vendors in the market to assess if agreements are still delivering good value for money.
TIP: You may also want to consider partnering with one vendor for a bundle of services to save costs.
Consider Partnering with a Managed Services Provider
Partnering with a reputable managed services provider will unlock access to expert support in making decisions to boost overall operating efficiency of your business and reduce costs in the right places.
A managed service provider lives and breathes IT. It is their full-time to keep up with opportunities and threats in the landscape, whilst you focus on what you do best. Building and maintaining a highly skilled and efficient in-house IT team incurs significant costs towards salaries and ongoing training. For instance, your business will need to pay for staff training to maximise the benefits of all changes made to your technology and infrastructure. Partnering with a managed services provider gives you a fully-trained, expert IT team acting as an extension to your business.
Or, if you would prefer to employee IT personnel, you could consider building a small team. Internal IT teams benefit from having the support of a third-party provider. They are there to share the vast responsibilities that come with technology, from day-to-day trouble shooting to long term projects and aligning IT strategy to the all important business objectives.
TIP: When assessing a partner to outsource your IT to, it's important to consider cost, services offered, reputation and how well they understand your business needs.
Identify Fixed IT Costs at the Start of the Year
Where possible, businesses are advised to identify all or as many as possible outgoings in advance, to make cashflow forecasting easier for the year ahead. Following on from the consideration of outsourcing your IT, you will find that most managed services providers work on a subscription basis. Having set figures for monthly and annual spend on IT helpdesk support, hosted technology and Software-as-a-Service (SAAS) gives your business an idea of how much of your budget remains to tackle any uncertainties the IT landscape has a reputation for.
TIP: A managed services provider is most likely to charge your firm a flat fee for the services they provide, and this is usually chargeable on a per user basis. This is the most cost-effective way to operate, linking back to the pay-as-you-go model.
IT costs make up a large chunk of every organisation’s budget. So, bringing them down can be a difficult job as there are priorities and different factors that tie into spend. Migrating to the cloud, regularly evaluating any third-party vendor agreements in place and partnering with a managed services provider are a few key considerations for Finance Directors looking to reduce costs in the right places.