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Reducing IT Expenses
In these days of recession and layoffs, IT managers are facing some tough decisions. As my own boss put it recently, "if it's a choice between upgrading our Office suite or laying off some people, what do you think we're going to do?"
With that in mind, there are a large number of things that an information technology manager can do to lower costs.
Postpone upgrading software - I know we are all supposed to bow to the Microsoft Gods, or at least open our wallets, but there is absolutely nothing in the new Office XP suite that makes it worth upgrading from Office 2000 or even Office 97. In fact, if your company is using any version of Office it will probably be fine for another year.
The same story holds true for everything else. I would recommend looking very closely at software upgrades of any kind during the next year or two. As a manager, I personally find postponing some upgrades much more agreeable than laying off people.
Renegotiate software and hardware contracts - Look at your contracts. Any coming up for renewal in the near future? Call these vendors and discuss lowering the rates. If the salesperson does not cooperate, then work your way up the organization board until you find someone who does cooperate.
Negotiate hard - Money is tight, so slow down and let time help you negotiate. When you must purchase something, get bids from lots of companies and make it known they are in competition. Work them ruthlessly against each other and you may find rates going down like crazy. Want an example? I had to purchase an enterprise backup package recently. Prices started in the $300,000 range, yet I took my time and let the vendors work down their rates. Within 30 days, the offers were all below the $60,000 range! That's quite a savings for just a few phone conversations.
Vendors are very hungry these days. For the first time in over a decade it's a buyers market. Enjoy it while you
can and get some revenge on those vendors who would not lower their prices last year - make them sweat.
Postpone hardware purchases - I don't know about you, but the pace of hardware changes during the past few years has been very difficult to manage. It seemed like we would just purchase 200 megahertz machines when the 400 megahertz models came out. We'd upgrade, then then 600 megahertz models were released.
I would recommend carefully considering all hardware purchases, especially upgrades, for a year or so. Sure, your users may want to upgrade to the newest 2 gigahertz machines, but I'll bet their 933 megahertz processors are working just fine.
Look closely at what your consultants are doing - If you use consultants, this is a great time to very closely examine what they are doing for you. Honestly look through their project list and question every single item. Discard projects that are not absolutely necessary, postpone what you can, lengthen tasks where you cannot postpone. Consultants are incredibly expensive, and often the tasks they perform can be cut back dramatically.
Renegotiate consulting contracts - This is an excellent time to discuss rates with your consultants. They may not want to lower their rates, but you most definitely have the upper hand in this economy. I've been able to get cuts of fifty to sixty percent lately just by spending a few minutes talking.
The point is simple. Money is tight and will probably get tighter before things loosen up. Now is the time to look over everything you do and reduce those costs. Not only will it help keep people employed, but it will impress the boss and company managers.
About the Author
Richard Lowe Jr. is the webmaster of Internet Tips And Secrets at http://www.internet-tips.net - Visit our website any time to read over 1,000 complete FREE articles about how to improve your internet profits, enjoyment and knowledge.
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