In the current economic climate, most business owners and directors will have felt under financial pressure for some time.
As things change politically and economically throughout the world, we feel the effect of every news item relating to the financial state of our countries. Many projects are shelved and at the very mention of recession, it is DIFFICULT TO FORECAST and plan budgets for any period of time above a quarter.
DISCUSSIONS RAGE within each nation’s government regarding the best way to solve the financial crisis; whether it is better to become more austere, cutting back on spending, or to invest, take on more debt, increase tax revenues and have more resources to pay off the debt. Whatever wisdom and insight we may feel we have for the situation, none of us really know what the correct strategy should be, and only time will tell if our leaders are making the best decisions for our economy.
If we apply this situation to our own businesses we face the same CHALLENGES, only with the added complication that if we need any extra funding we may have to go the banks, which have their own challenges with regards to increased investment and risk.
As businesses, our options for adding investment are slightly more limited than those of our governments, and often the only option we have is to adjust our costs and spending in order to MAXIMISE AVAILABLE RESOURCES and operate more efficiently.
The reaction of most businesses is to remove and reduce costs from the balance sheets. This may involve:
- Reduction of additional staffing costs, such as over time or shift working.
- Removal of permanent staffing costs in the form of redundancy.
- Termination of contractors.
- Close examination and control of daily expenses and travel expense.
- Scrutiny over the procurement of new items such as IT hardware and Software.
Whilst these steps help us to control expense, the gains that are made and transferred to the bottom line may still be minimal, so… IS THERE ANOTHER OPTION?
For a number of years the term Cost Optimisation has been recognised as a method of getting more out of what you have, but what does the phrase Cost Optimisation really mean? And how could it apply to business challenges in today’s economic climate?
Cost optimisation is the process of re-working the resources you have available and “working smarter, not harder”. In effect, this means taking the resources that you have and doing more with them. But …HOW DOES THIS RELATE TO IT SYSTEMS?
IT Cost Optimisation
Cost Optimisation releases resources previously used for operational tasks, to perform strategic or aspirational activities, helping to align IT direction with the business it supports. The ability of IT systems to align with the business’s primary purpose enables the IT function to ADD VALUE to the business TODAY and help to GROW THE BUSINESS, TOMORROW.
Having an IT function that understands what is important to the business creates a convergence of VISION and DIRECTION within the organisation. The organisation can use IT to DRIVE DECISION MAKING, rather than making difficult demands on IT systems.
Cost Optimisation can take the form of exploiting a server that currently has a single function to add a second function, so that the machine PERFORMS TWICE AS MANY TASKS without the cost of doubling your hardware. In human terms, Cost Optimisation makes tasks simpler or automates them using IT systems, releasing employees to manage more tasks.
Cost Optimisation can be divided into 2 distinct categories. Although the method of providing the time and space for your staff is different, the intention and outcome is the same for both categories: FREE STAFF TO UNDERTAKE IMPORTANT STRATEGIC TASKS.
OPERATIONAL COST OPTIMISATION
This is the process of identifying IT related tasks that are carried out by your more expensive IT staff and resources. The tasks will be carried out on a regular basis during the working day, week or month and will be defined as “standard tasks”, that is, a task that can be defined as a process with standard inputs and predictable outputs. By reorganising the team to ensure that the standard tasks are carried out by your support technicians, rather than more expensive resources, you can free more senior staff for more important strategic tasks.
STRATEGIC COST OPTIMISATION – INDIGO MOUNTAIN
With Strategic Cost Optimisation, daily operational tasks are identified and passed across to a TRUSTED PARTNER. The trusted partner has skills and experience to manage those tasks in an efficient manner, providing full information about progress and status, whilst integrating into your existing support team infrastructure to provide more COST EFFECTIVE DELIVERY:
- Remove the pain of managing staff.
- Identify key deliverables and realise a more consistent delivery.
- Set out charges, service levels and costs in advance through contract.
- Lower your costs through economies of scale introduced by the partner.
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