The company is trying to cut costs wherever possible. Whether headcount has been affected or not, you still need to reduce what you are spending while delivering more and more services to your company or clients. How can you possibly increase productivity while decreasing costs?
Doubtless, you’ve heard the phrase “work smarter, not harder” at least a few times before.
But just how do you achieve that?
If you are among the vast majority of companies that have done a lot of technology growing over the past several years without taking the time to purposefully streamline your operations, you may be in luck.
The trends over the past decade have been growth oriented. This has led to a lot of technology spending which has resulted in larger numbers of assets to manage and account for. The future completely contradicts our past practices of hosting one application tier per server.
The good news is that today, you probably already have everything you need to start reclaiming a big chunk of your IT budget.
Here are just a few things to consider while taking a look at your budget sheets. The end result is that you can easily free up valuable physical servers, rack space, port space, electricity costs, maintenance contracts, application licenses, and even MAKE money by selling back your decommissioned equipment.
Physical System Count
We are witnessing a rise in the number of data centers running out of physical space to house new systems in. New projects are not slowing down, especially when these new projects are business initiatives targeting more revenue during these difficult times. One solution is to purchase more rack space in a co-location facility or to add more racks to your internal data center. The co-location option can cost you additional tens of thousands of dollars per month, and maintaining enough power, cooling, and network/storage ports in your own data center are both solutions in the wrong direction.
An industry average 85% of all servers in use today are less than 3% utilized! This means that you can potentially locate 30 of these low utilization systems on one physical host and still have 10% utilization left over to handle peak times. These staggering numbers have given rise to virtualization and the paradigm shift in computing infrastructures.
Hardware Maintenance Costs
Chances are that you are paying vendor maintenance fees on systems that are no longer covered by the original warranty from purchase. At an average yearly cost of $1000 per machine per year, reducing the number of physical systems in your environment can add up quickly. Many companies exist that will buy back your used equipment at a reasonable rate which puts money back into your pocket. Otherwise, decommissioned systems can be redeployed to satisfy future requests, development environments, or projects that help the company find new revenue streams.
Application License Costs
Do you have ten SQL server licenses and ten databases running on ten physical servers? Does your company support twenty separate instances of IIS to serve the production, development, and QA of critical websites? We commonly see this at client sites and where that may have made sense in the past, it is time to consolidate instances of like functionality wherever it makes technical sense – often times a single host is needed to adequately provide the resources necessary for intensive database applications. Just as often though, several smaller instances can be combined on a single host and licensing and physical systems can be reclaimed for other purposes or sold back.
Operating System Deployment
It is not the most obvious method, but reducing the number of different operating systems in your environment can greatly increase the productivity of your engineers and reduce unexpected downtime, among a host of other benefits.
Just looking at Microsoft operating systems alone, most companies have Windows 2000 Server, Windows 2000 Advanced Server, Windows 2003 Standard Server, Windows 2003 Enterprise Server, Windows 2008 Standard Server, Windows 2008 Enterprise Server, and yes, even Windows NT 4.0. In 2009!
On the surface, one may claim that Windows is Windows. Applications like antivirus, database, messaging, to name a few, behave differently on each version that your staff will need to support. Additionally, the general maintenance of so many versions translates to a whole set of patches needing to be tested and applied to each version each month, you need an enormous number of ‘standard’ server builds and deployments, and supporting the same application across multiple operating system platforms can be challenging and time consuming.
Not every instance of an aging OS can be upgraded, but a large number can. With the technology to quickly and easily test an OS upgrade before executing it, everyone should at least be evaluating their OS deployments.
Even with an enormous potential for soft cost savings, hard cost savings can be realized through quantity discounts and reduction in support for legacy versions.
Similar to the reasons why reducing the number of OS versions can reduce costs, reducing the number of applications deployed across your organization will greatly simply support for and licensing of those resources. Additionally, if you have not scanned your network for application deployment, you may be surprised to see what is installed on your network. As a business, you are responsible for anything your employees install on the company owned network. Exceeding your license counts for products can be a costly penalty in the event of a license audit by a vendor.
Open Source Applications
The functionality and business cases for the use of open source software is experiencing a meteoric rise right now. Attention to spending across the board and the popularity – and usability – of the Ubuntu Linux server and desktop operating systems seem to have, at least in part, been the tipping point of mainstream acceptance of open source software. Entire companies are now being formed to deliver and support open source software.
Consider this – if your twenty person small business can use the free OpenOffice alternative to Microsoft Office, that alone translates to a savings of $6580 (Based on $329 for each Office 2007 Standard license.)
Use What You Own
We often see clients looking to invest in new products that will achieve exactly the same thing as products currently deployed or sitting on the shelf. For example, if you are interested in monitoring and baselining your current power consumption across systems and gear, you already own a monitoring system that is often times much better than what you would buy from vendors of green software solutions – it is called SNMP and all operating systems and hardware come with the ability to send/receive the data you seek. Why pay license fees and training costs for additional tools that will accomplish the same task as something you already own and your engineers are already capable of using?
Align Support Resources Appropriately
This is more of a soft cost savings rather than a hard cause and effect scenario, but nonetheless important. Over the years, IT organizations have undergone countless organizational model changes in an effort to save money. The bottom line is this – the right people must be working in the right position for any given job. Assigning your top sales people to be the front line for client technical issues is going to be just as successful as assigning your top consulting resources to sales. These are two different jobs that each have a unique path of study and require years of experience.