Using IT to cut your costs
This article first appeared on October 20, 2011
Can you spend a dollar to save a dollar? If your business is using the wrong IT systems, the answer is almost certainly yes. Most SMEs want IT that works and doesn't cost the earth. Fair enough. But it also pays to think strategically, because using the right IT systems (delivered in the right ways) can save your business money and make it more efficient.
Here are a few things to consider if you're looking to save on (or through) IT:
Stop spending capital
The cloud is just part of the current push towards services-based computing. Pricing models for these services – which include everything from MYOB to complete IT infrastructures – typically involve month-to-month fees, based on how much you use them.
What they don't involve is a large up-front capital investment. This means you can reduce your risks and pay only for what you need, scaling your spending up or down as required.
If you're not yet ready for the cloud, make sure that you're considering server virtualisation.
Virtualisation allows you to make efficient use of your computing hardware by hosting several virtual servers on the one physical machine.
Depending on how efficient your current servers are, you can reduce your related costs anywhere between 30 and 70%. One business I recently dealt with turned 30 physical servers into five, a move which also cut their electricity bill by 80%.
The cost of airfares, hotels and taxis quickly add up when staff are on the move.
While Skype works in some circumstances, if you have offices interstate then a proper video conferencing service can cut travel costs and boost productivity through better collaboration. Staff will also waste less time on the road.
According to IDC research, "cost saving" is the number one benefit SMEs nominate when it comes to outsourcing IT.
The idea is that you cut back on internal IT staff, saving salary, training and associated costs, while exploiting the knowledge of your external IT partner to get access to skills that you wouldn't otherwise be able to afford.
You'll also leverage your provider's higher buying power to purchase hardware and software more cheaply. Right now, cloud-based infrastructures are taking outsourcing to another level.
If, like most businesses, you're a heavy phone user, make sure that you're reviewing what you're paying for voice communications at least annually, if not more often.
To cut costs, some form of Voice-over-IP solution is a must.
Unified Communications services have also come along in leaps and bounds recently, with some now specifically geared for SMEs rather than the big end of town. These make your business communications much more effective through functions such as voice-message to email, and instant indicators as to whether or not your staff are at their desks ready to take a call.
At the moment, one of the fastest ways to reduce your costs by working more efficiently is to ensure that you have 'anywhere, anytime' access to your systems.
Whether that's your CRM, ERP or Microsoft Office documents, mobility across smartphones, tablets and laptops while on the go will help to ramp up your operations. Approach your provider, as many will already have mobility systems for their products ready to go.
Depending on what your business does, you might also consider creating your own mobile application as a way to get a competitive edge.
Dave Stevens is managing director of managed IT services business, Brennan IT.