Top 5 Ways for CIOs to Manage IT Costs Beyond the COVID-19 Crisis

As the COVID-19 crisis continues to force a reduction in organizational spending, IT a key area where many enterprises are feeling the pressure to cut down on costs. Organizations need a programmatic and strategic approach to cost optimization to survive through the downturns resulting from potential future crisis like the coronavirus pandemic. 

The process of IT cost optimization calls for an increased collaboration between the CIO and other executives to evaluate the cost drivers. This is usually achieved by calculating how IT costs affect the delivery of IT services and their impact on the revenue and business costs. But these discussions often fail to assess the impact of IT spending across other business verticals in the company. Collaborating with other C-suite executives especially for cost optimization initiatives can help CIOs successfully optimize IT costs.

Michael McDanielIn an exclusive interview with EnterpriseTalk, Michael McDaniel, VP and General Manager of Modern Workplace at DXC Technology says, “As people start to work remotely, the challenges that CIOs face are the increased cost in the infrastructure side of businesses. One of the things that we are doing to help our clients is look at how to reduce these costs. The majority of our clients say a minimum of 30% of their workforce will continue to be remote even after they start to bring people back to work and an additional 30% will be in a hybrid mode, where they work remotely one or two days a week and come into the office for the rest.”

Listen to the Podcast: Interview With Michael McDaniel Vice President & General Manager DXC Technology

“The office will change to be more of collaboration space and these collaboration spaces need to be upgraded to connect the world of people that are sitting virtually and the world of people that come in, in a hybrid mode and those that or on-site or out in the field. So, what we have been doing to help our clients with the total cost equation – to help them collaborate better – is connecting the end-to-end process of what we now call the modern workplace,” he adds.

Here are five strategies for IT cost optimization for CIOs to navigate budget constraints in today’s volatile business environment.

Cost Reduction Measures

First and foremost, CIOs need to understand all the available measures, so that they can proactively create a clear point of view about which cuts are possible and the potential risks associated with them. CIOs can then make these decisions based on how the business situation plays out.

Business Transformation Strategies

CIOs must invite business stakeholders and collaborate with them to find robust ideas for better cost optimization. They can then share the savings produced from these idea-generating discussions with the business unit and maybe even start a cycle of continuous reinvestment. This kind of partnership can bring down redundant IT expenses and also increase visibility in the business unit IT spending.

IT Financial Transparency

CIOs must also comprehend how IT services are being delivered and also understand the associated costs related to IT operations. They should work with the finance division to connect general ledger entries to technical costs and other costs for business services. IT financial transparency in enterprise IT spending can help CIOs optimize costs and deliver business value through IT services.

Also Read: Address these Imperatives to Lead Digital Transformation in 2021

Optimizing the Workforce

Leveraging workforce management application tools like virtual assistants for routine tasks and automation of manager experience can help in reducing staffing costs. Enterprises can implement bots to support their human workforce and create a more productive work environment.

Robotic Process Automation

Organizations can also utilize technologies like artificial intelligence and RPA (robotic process automation) to assess and identify patterns needed to make strategic business decisions. These technologies can automate processes that are challenging or impossible for humans to perform and can also help in discovering new insights from data.

Michael adds, “Because CIOs have so many end points that are there out on the edge they have to manage, they have some increased security concerns and they have to put more focus on their security and we have been helping them with ways to reduce their overall cost that they have in the more traditional services like their end user support desk. We now have automation that drives a lot of the calls, that means we can reduce the overall man power and allow them to shift their dollars to spend on more important things like the security aspect of having those end-points remote.”

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Prangya Pandab is an Associate Editor with OnDot Media. She is a seasoned journalist with almost seven years of experience in the business news sector. Before joining ODM, she was a journalist with CNBC-TV18 for four years. She also had a brief stint with an infrastructure finance company working for their communications and branding vertical.