In my last blog, I began talking about the cost pressures in IT. So what about them? What can we do to save money?
Well, I believe that every company can save money in and with IT by simply standardizing the IT environment.
So let’s imagine. We take a company with about 4’000 employees in the midst of their Windows 7 and Office 2010 upgrade project just before Windows XP runs out of support. The specialists gather to talk about the requirements this new Client “Win7 and Office 2010” has to fulfill. They scramble a list with all the applications that need to run on the next generation of desktops. After shorting the list, they end up with a list of 300 software vendors. How does a company with 4’000 employees end up with 300 Software Vendors? Easily, because in most cases IT grew simultaneously with the business and largely as a cost center. So you have Marketing, Research, Finance etc. all leveraging their own set of tools and to make matters worse most of these tools are highly customized or a completely customized development. Again, with all the cost pressures you end up buying as cheap as possible from a small software vendor to fill the demand. Over time, the applications become critical and often the small software vendor has not kept up with the innovation of the large vendors and because of that, you can’t upgrade the specialized software like your Desktop.
This is when standardization is key and the C-Suite needs to enforce a set of standard solution for the company. When a department asks for customization, request a business impact analysis in return. In many cases the idea has literally zero business impact. We have seen customers turning down new products because it didn’t allow the existing process to be completely integrated into the new solution. The existing process has been there for years and now a new solution with a ton of benefits is being turned down simply because the antiquated process cannot be integrated. Really?
Standardization doesn’t mean that you need to get all your applications from one vendor. What I really challenge you to question is, “Do you need that many applications, that you currently use.” It seems to me today that we as IT are still allowing too many people in our organizations to demand what they want and end up giving them exception after exception.
For example, many passionate sports car enthusiasts drive a standard sports car, right? Only a few percent go to the extent of actually building a top of the line sports car for themselves. Why? Because the standard sports car is good enough. The benefit of the car built from scratch doesn’t make up for the extra cost.
The same goes for applications. The benefits of highly customized applications often don’t make up for the extra costs. Especially when viewing the whole life cycle picture and acknowledging the dependencies it creates within the IT environment. This scenario can easily lead to the point where you get stuck and can’t upgrade other parts of your environment, which will cost you a lot more to rectify and can actually make you vulnerable. This doesn’t mean that you shouldn’t make your own solutions. What I am saying is to drive your business with innovative applications, and do it right by forgoing the cost center mentality and treating it as an investment for the future of your business.
With the rise of the cloud, there is no more time to loose. I challenge you to make the decision and empower your IT department to simplify the environment and give them room to work on innovation projects rather than just life cycle projects. Doing so will not only help you to reduce costs but also to gain efficiency and the advantage over your competitors.
Do you agree? What are your thoughts?