4 Steps to Ensure IT Efficiency
IT is under increasing pressure as never before to do more with less. Budgets are static and often cut. Network security is taking up more and more resources, and the range and frequency of threats increases.
At the same time, they are under pressure to increase the range of services offered to internal users and external customers. Integration with Social Media and providing remote access to corporate resources over the Internet and VPNs is consuming time and effort. In some environments, Cloud Computing and the Internet of Things are coming.
Faced with diminishing budgets, and a new requirement to improve the bottom line through cost efficiencies, balanced against increasing cost pressures, particularly for network, data and Intellectual Property security, the savvy IT Head is continually looking for ways to increase operational efficiencies and find more bangs for the buck.
Here are four potential approaches to ensuring improved efficiencies.
Some years ago, the trend in business was to diversify, in the belief that if one sector underperformed, then others would compensate. More recently, there has been a trend to focus on the core business and ignore or outsource non-core activities.
IT followed these trends, in the first instance, keeping everything as far as possible internal to be able to respond quickly to events, and latterly to look seriously at IT Outsourcing to manage and control operational costs.
Simply put, IT Outsourcing is where an external organisation is subcontracted to carry out defined tasks on behalf of a business.
There are various types of IT outsourcing, from having third party staff on your premises, to “Offshoring”, where an entire IT function moves to a cheaper location. Call Centres have blazed that trail, with, for example, British Airways centralising all their call centre operations in India.
Having said that, there is now a trend back to “Onshoring” or “Reshoring”, basically repatriating IT services. The trend has been driven by US protectionist policies and in the UK, by the uncertainties following Brexit and it’s effect on supply chains.
Be aware, though that Outsourcing and offshoring are not necessarily the same thing.
The move to Cloud Computing includes an evaluation of IT Outsourcing, either inhouse on existing equipment or using a Managed Service Providers infrastructure.
Why should IT Heads consider Outsourcing as an option?
In summary, Outsourcing can reduce operational costs, improve time to market and leverage the skills and expertise of external resources.
A fixed price outsourcing contract with a service provider moves costs from variable to fixed. Cost schedules are usually negotiated with the supplier to include inflation-related cost escalations built into the cost structure. This eases budget preparation and removes one area of uncertainty from budget management.
Core Business Focus
IT mirrors the trend for a “back to the knitting” focus in business with routine daily operations outsourced to a third party. Departmental staff can concentrate on providing value-added services to internal and external clients, increasing their productivity and raising the profile of IT in the business.
External Resource Requirements
Time to market for new services has sharply decreased in recent years. The need for speed generates a concentration on project delivery times.
To meet the accelerated demand, many IT projects or projects with an IT component need specialist resources, but only for the duration of the project or a segment of the project. Outsourced staff are recruited for a specific task rather than as long-term employees, reducing overall staffing costs.
Their use must also include a skills transfer component, thereby upskilling internal staff and providing them with the expertise to reuse the acquired skills.
Hardware and Software Consolidation
A close examination of the work of the department will usually show that a lot of time and effort goes into implementing and maintaining interfaces between systems. The divergence often happens over a while as new hardware and software solutions come into operation.
The practical result is that intersystem communications can be disrupted if an update to one system makes the interface inoperable or transfers wrong data.
Creating an operational strategy to standardise or remove interfaces will release staff to more productive tasks.
Many organisations rarely, if ever, change their operational; procedures, and a culture of “not invented here” can prevail. Over time, therefore, procedures can become time-consuming and costly.
A regular review of operational procedures from time to time will help to keep the department running smoothly.
A key issue in developing a long-term ICT strategy is that it must reflect the strategic objectives of the business. That is only possible if the IT Head is part of the business strategic planning process.
The benefits will not be immediate, but will result in a closer fit between business and ICT strategies and the use of cost-efficient measures to support them.