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Cost Optimization


IT cost cutting has consequences

Minimize the damage of IT cost cuts


The challenge

  • Capex and Opex growth rates, or even as budgets, will most likely continue to decline in the coming years.
  • Most common quick-win initiatives have been taken already and do not satisfy the company's mandate.
  • Typically, cost-cutting initiatives fail to deliver the promised savings. They also tend to take longer than anticipated.
  • Cost-optimization initiatives often have unintended side-effects, potentially even off-setting the savings and leaving the business dissatisfied.

Our advice

Insight

  • IT is an integral part of the business value creation chain. Cost-cutting here means that the entire company can be affected. IT must work with the business in partnership to convey the full implications.
  • Avoid large scale cost-cutting or making all of the cost cuts at once. Do this in a phased approach so that you can avoid or manage the consequences.
  • If a service is delivering the intended value, then cut it completely.

Impact and results 

  • Take a value-based approach to cost-cutting.
  • Reduce your IT spend in such a way as to continue to deliver on the essential services.
  • Always involve the business in cost-cutting exercises.
  • Develop a cost-cutting plan that avoids unintended business interruptions.

The roadmap

Besides the small introduction, subscribers and consulting clients within this management domain have access to :

Get started

Our concise executive brief shows you why you should take a value-based cost initiative in your company. We'll show you our methodology and the ways we can help you in completing this.

  • Minimize the Damage of IT Cost Cuts – Executive Brief (ppt)
  • Minimize the Damage of IT Cost Cuts – Phases 1-3 (ppt)

Understand your mandate

Determine your approach and then take immediate action.

  • Minimize the Damage of IT Cost Cuts – Phase 1: Understand the Mandate and Take Immediate Action (ppt)
  • Cost-Cutting Plan (ppt)
  • Cost-Cutting Planning Tool (xls)

Select initiatives

Identify all initiatives and then build your roadmap.

  • Minimize the Damage of IT Cost Cuts – Phase 2: Select Cost-Cutting Initiatives (ppt)

Communicate to the business and get approval for your plan.

When you will execute your plan, adopt change management best practices.

  • Minimize the Damage of IT Cost Cuts – Phase 3: Get Approval for Your Cost-Cutting Plan and Adopt Change Management Best Practices (ppt)
  • IT Personnel Engagement Plan (doc)
  • Stakeholder Communication Planning Tool (xls)

 

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