Network World is reporting that Gartner has recommended 20 steps which can be taken to cut IT costs in a recession.
These are the same 20 steps which can be taken to cut IT costs during prosperity as well, so even if a miracle happens and the stock market repairs itself tomorrow – might want to keep this around the office in a drawer somewhere.
Below is the list – with some annotations that we’ve added to give some perspective.
1. The most obvious place to start is people costs. Gartner estimates that 37% of the average IT budget is dedicated to personnel, so this represents a major opportunity to save money. Gartner recommends a blend of hiring freezes, reducing or eliminating special bonuses, cutting back on outside contractors. Also, global companies that have opened offices in remote areas should consider bringing those workers back home.
This is a good plan, of course, but one of the key things to remember about bringing IT workers back from branch offices to the headquarters involves moving the servers that they manage with them. If you don’t do this, no matter how good your administrators are at logging in remotely, there’s going to be a problem, sooner or later, that will require expensive airfare.
WAN Optimization, virtualization, and its brother-in-arms, server consolidation will make this possible. But remember that when you move the server closer to the HQ, you’re essentially moving the workers farther away from the servers. This means that traffic that once went on local area networks now travels on the WAN. It would be a good idea to make sure that the WAN can handle the new traffic, and if applications aren’t properly developed for a higher-latency, lower-bandwidth network, it’s probably time to find that out.
2. Flatten the organization. Instead of having one person manage six or seven employees, trim some of that middle management and have your IT execs manage more like 20 people. A flat organization not only saves money but also can lead to more efficiency.
3. Move to shared services. In other words, consolidate things like help desk into one group that services the entire company.
4. Even if you have to borrow somebody from another part of the company, bring a finance person into your leadership team so that person can analyze your budget and find ways to help you trim costs.
5. Don't ignore "unmanaged" costs like printers or data center power.
6. Go back and check your invoices to make sure your vendors are charging you what your contract specifies. An example would be if your wireless vendor agreed to give you free shipping when it sends new cell phones to remote workers. A few months later, shipping charges might start appearing on your cell phone bill, and if you don't check, you'll never know.
7. Eliminate unused software and modules.
Another way to look at this is to round up the unintegrated, non standardized and overlapping “bag o’ tools” that engineering groups generally have lying around. Beyond the license and maintenance implications, tools standardization can lower training costs and provide a more common language and methodology for a team.
8. Get tougher with vendors when it comes to negotiating contracts. Don't be afraid to switch vendors, or at least go the first step of determining what it would cost to switch.
This is especially true when you’re talking about managing service level agreements for leased lines – it’s important to independently verify the claims that they will improve performance or provide a certain level of service. Do you have something to measure that? If you’ve got Cisco gear, you can use IP SLA tests to get edge-to-edge measurements. More than ever, you need visibility into these service levels so you know when there is degradation and you can hold your vendors accountable.
9. Buy a telecom expense-management service. It pays for itself and more.
10. Deploy a corporatewide plan for buying cell phones. Then, buy a cell phone plan that optimizes expenses. This will be cheaper than letting employees buy phones and plans and then expense them.
11. If there are places where you don't need five nines of availability, settle for three nines. It will save you money when you negotiate with your vendor.
Additionally, I’d say that application performance would be the key metric – not availability. There’s really little difference between 99.999% uptime and 99.9% uptime from a practical point anyway. (5 minutes of downtime per year compared to 8 hours, 45 minutes of downtime a year.)
However, there is a huge difference between an application that performs well and one that performs poorly, if only because you’d rather run a fast performing application for 364 days, 16 hours a year than a slower one for 364 days, 23 hours, 55 minutes a year.
Do you know when performance issues are the fault of your service provider? Can you measure application performance day to day, month to month, to know what your ends users are experiencing? There are management tools that help you do this .
12. Consider buying a videoconferencing unit rather than constantly renting.
Additionally, make sure that your network can handle the traffic from the videoconferencing stream – video takes up huge amounts of bandwidth and can impact the performance of other applications if not managed properly. Know how to do this?
13. Where possible, use the Internet as a replacement for expensive WAN transport services.
The key phrase in the above sentence is where possible. There are some applications which belong on the WAN and would perform inadequately over the Internet. However, that doesn’t mean that some applications can’t be moved to the Internet – just make sure that you’re aware of the trade-offs in reliability and performance in exchange for cost.
14. Defer moving to Vista. If your PC hardware is holding up, consider sticking with it another year.
Really, though, is anyone planning to move to Vista? I think we’re all hanging with XP until we get Windows 7.
15. Use commodity products wherever possible, and skip best of breed in cases where "best of need" will suffice.
16. Consolidate and virtualize servers.
Just make sure that you do not lose visibility into the network when you do virtualize. Virtualization adds complexity and instead of having to monitor inter-server interactions, you now have to manage intra-server interactions as well.
17. Reduce storage costs via data deduplication and other methods.
18. Use better processes and policy to make better use of existing tools.
19. Deploy IP telephony and VoIP as a way of cutting costs for moves, adds and changes.
Again, VoIP can play havoc with your network if you haven’t configured it correctly and set appropriate policies for the VoIP traffic to coexist with the TCP traffic that holds application data. Additionally, make sure that VoIP provides a quality of experience comparable to that of a POTS phone line.
20. Harvest unused software licenses and reuse them when a new employee makes a request.