Five tips how to quickly reduce your IT costs
Published 10 December 2020/Blog
Sometimes an organization, for example during a pandemic, may have to fight for survival instead of growth. As a result, many companies today are looking for ways to reduce their costs, and within the IT department there may be several such opportunities. Here we go through five points to reduce your IT costs that can be tolerated in a survival situation.
1. One Sweep
Plan properly and make all cost reductions in one go. This is something that most organizations fail at and repeatedly implementing cost-cutting measures is creating uncertainty within the organization with potentially very detrimental impact. This is for obvious reasons extra relevant when redundancies are on the agenda
2. A Quick Change
Focus on costs that can be reduced in a shorter time frame, we are talking about weeks or months, not years. An example is licensing costs that are usually paid per month or possibly quarterly. If you, like the majority of companies in Sweden, use Microsoft, feel free to contact us for more information on our packages from Microsoft.
3. Think Cash Flow
Focus on what can have a real impact on cash flow, ie real expenses and not costs such as depreciation and amortization. One way to reduce IT costs can be through a transition to or optimization of the cloud. This can also result in an income when after a move of, for example, a SQL server to Microsoft Azure, you could sell the hardware that your previous SQL was on.
4. Fixed costs versus variable costs
Regarding fixed costs, ie costs that are constant without regard to your use, you should focus on elimination. A potential candidate in these times where more and more people work from home is of course the rent for the office. Regarding variable costs, ie costs that change depending on volume and use, the focus should be on both reduction and elimination.
5. Challenge your IT suppliers
Dare to challenge your IT suppliers and seek to reduce your costs together, and review your agreements with the supplier and whether these can be renegotiated at a lower cost. Also look at what other suppliers can offer, it gives you both more to come to the negotiating table with your current supplier but also an opportunity to find new contacts with even better offers. Do you want to challenge your IT supplier today? Let us help you along the way.
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