While the economy is improving, IT budgets aren’t necessarily bigger. In fact, Gartner recently cut its worldwide technology sales growth projections for 2013 by more than half, from 4.1% to 2%. Consequently, it continues to be important for IT managers to be able to do more with less – and some are even finding ways to generate revenue from the department rather than having it seen only as a cost center.
But before you set up a lemonade stand or a bake sale to increase your budget, here are some suggestions for how you can save money -- and, potentially, even make money -- in your department.
Used/refurbished equipment. If you’re one of the people whose houses are decorated in Early Craigslist, you may already be aware that your data center can make use of used and refurbished equipment as well. In fact, according to research firm IDC, up to 70% of companies have purchased used, reconditioned equipment in the past two years, and the market for used and refurbished computer equipment is reportedly $70 billion.
On the other hand, this doesn’t necessarily mean that you should try to continue running your company on the same outdated equipment you’ve been using for years. If all your employees are still running Windows XP-only machines, for example, you could be losing money in productivity, support costs, and even electricity and cooling costs as newer equipment is increasingly environmentally responsible. But when you’re ready to jettison the old equipment, be open to the possibility of refurbished newer equipment.
And while you’re at it, the used and refurbished market is a potential destination for your outdated equipment as well.
Cut costs with technology. Similarly, in the past few years there have been a number of new technologies that can save money -- especially if you look at the total cost of ownership (TCO) of support costs and other expenses. Virtualization can save space and operator time, for example. Voice over IP technologies can save at least 10% even if you only use it for internal calls. And of course cloud technologies and BYOD can save companies money by foisting the hardware capital expenditures onto someone else. Or follow the federal government’s lead and look for ways to consolidate data centers and use shared services -- but be sure that when you look at TCO it’s actually saving you money.
Contract -- make yourself smaller -- by looking at contracts. While you’re at it, go through all the various service contracts and agreements you have to see if you’re paying for things you no longer need. “Sometimes, taking a step back and acquiring a fresh perspective is all it takes for an IT executive to truly understand the budget issues they are having and find a proper solution,” writes Alicia Stein at Midsize Enterprise Strategies. “Many of the CIO respondents said they reviewed or refreshed IT communication contracts and various operation elements to oil their IT machine and save money.” Similarly, look for functions you can outsource, such as printer maintenance, she says.
Help the environment. Going paperless, looking for alternative ways to cool the data center, or using the data center heat for the rest of the building isn’t just environmentally friendly, it can also save you a lot of money. And employees who might be unwilling to make a change just to save the company money might be more willing if it’s couched in environmental terms.
Look for ways to earn revenue. Whether it’s selling customer data or developing portals and other applications to better leverage your company’s products, up to 25% of CIOs are becoming revenue producers, writes Diane Frank in CIO. “Top-notch CIOs in various industries are creating new ways to pull in revenue at their companies,” she writes. “The techniques vary widely: Some use IT to boost showroom sales, or sell homegrown software to other companies. Others take the valuable data they produce in-house and turn it into a saleable information service.”
The point is, it may continue to be a challenging couple of years, but you do have options for maintaining or even increasing your budget.