How to reduce IT costs

As large companies need to adapt to new routines due to the pandemic and provide assistance to all those who work in internal teams, managers and directors are looking for practical solutions to face major economic crises.

Although all sectors are in the sights of CIOs, the attention of these professionals ends up focusing on the management of IT costs, more precisely, they are focused on reducing IT costs.

If you, the manager, are in the same situation, you need to review all the cost options and assess the strategic context of the business before making any decision on cost cutting.

A poorly thought out decision can do more harm to a business rather than benefit in the long run. It’s like they say: you need to cut costs more intelligently.

Many managers end up following the traditional paths for reduction such as the famous “tighten the belt” and demand that the IT team maintain a high standard of service, with a much shorter budget.

Continue to understand more effective ways to reduce IT costs without necessarily choosing the more traditional paths.

Good reading!

Before you start cutting costs, design a cost reduction strategy

Cost reduction should be treated like any other type of internal project.

It is necessary to analyze the context in which the company lives and which strategies must be followed to only then define which costs must be reduced in order to face the financial crisis that the business started to face.

Once all the strategies are elaborated, well developed, studied and aligned with the business proposal, the plan can finally be put into practice.

To develop this plan, with all the necessary strategies focused on reducing costs, we recommend that you evaluate some points such as:

1. Determine the reason for each cost reduction strategy. Remember that it is not enough to just “cut expenses” in half, but it is necessary to measure how that cut will affect the IT team and what are the alternatives to maintain the good quality of care and services, with a lower investment.

2. Less can mean more. This is a concept that makes all the difference in various segments such as advertising, fashion, gastronomy and even in the area of ​​technology. Many teams could be more productive with less, including a specialized and leaner IT team, more complete and automated systems.

3. Apply strategies that can be completely reversed. There are decisions that, in the short term, seem to be the best, but have a great impact on the company and cannot be reversed if the company is once again able to inject new investments in the sector. That is why every manager needs to think about cutting costs in the long run, not just the “here and now”.

4. Define how each cost reduction strategy will be implemented. It is not enough to have a great solution to reduce costs without affecting productivity, every manager needs to define how the plan will be put into practice, in case something goes wrong, needs a prevention plan and needs to take into account the entire team of IT technicians .

A planning team must be created to devise cost-cutting strategies. The team of technicians must also be part of this planning, since they are the ones in the front line and are able to see situations that the manager can miss.

Once the planning phase is completed, the planning team must move on to the implementation phase. Analysis metrics should be defined to study what the entire team of technicians is responding to with the plan to reduce IT costs.

The plan must be followed strictly so that spending does not get out of control or the team shows negative results.

Invest in IT productivity and flexibility

IT is an area that always needs to be reinvented. Not only because of the technology that changes all the time, but your budget must always follow the performance and needs of the business.

Due to the speed with which technology evolves, new possibilities must always be on the radar of every manager. Often the budget is out of date and above what IT really needs to function and improve.

In cases where the budget is too high, managers need to study how to change the picture and improve it for everyone involved.

Two ways to reduce IT costs and increase liquidity are:

1. Hardware update

In the content “ What you need to know about reducing IT costs ” we talked about the possibility of joining cloud services as an alternative to reduce costs.

The hardware update provides for the replacement of equipment, services and ways of storing information.

In addition to the cloud, old equipment can consume more energy, in addition to preventing technicians from working with agility and producing more.

2. Automation

The automation of the company’s field services allows you to reduce personnel costs and errors.

Many processes are discarded with automation, not to mention the time it takes technicians to solve problems, free access and do all kinds of services is much faster.

Think of automation as an aid to artificial intelligence, a tool capable of helping to reduce costs and still take the company into an increasingly digital era.

Is your team prepared for the changes?

When we mentioned the importance of the team of IT technicians participating in the elaboration of cost reduction planning, it was precisely to prepare them for this very important moment.

Many people do not welcome cost reduction strategies. Therefore, the more involved the team is, the better the adaptation and implementation of the proposed changes will be.

Our team of Nerds can help you find the best strategy to reduce your IT expenses. Talk to our experts and create a plan tailored to your team and business.