IT Cost Transparency Results Achieved
The buzz word around “IT cost transparency” is a vague notion, and largely misunderstood. Basically, it means seeing what you spend.. So what now?
A study done by Nucleus Research found that for every dollar a company invests in business analytics it earns $10.66, that’s a 1066% ROI.
So how does cost transparency translate into real ROI results?
The ROI of IT Cost Transparency when implemented with an IT expense management solution is manifested in 2 domains. These are: actual savings and process efficiency; both of which can contribute to creating real value to the business on a recurring basis.
1. Invoice DiscrepanciesHaving a mechanism to discover errors can find one offs, ongoing errors, and can even surface potential fraudulent activity.
2. Proactive Policy EnforcementProactive management includes setting policies to curb unnecessary usage and spending. Policies need to be tailored to the employees and department specifically. You don’t want to be curbing the consumption habits of your top sales people, as an example.
3. OptimizationOptimization means matching the consumption of assets and services with cost, without overspending a penny. It’s about getting the biggest bang for your buck. This means analyzing what you have and determining the best combination of assets and services that drive the most value for the organization.
4. Discovery of Unused ServicesUnused services can be costing an organization without anyone even knowing it. As employees leave, transfer, or relocate within a company, services get left behind. The time being billed between when an employee leaves and when the service gets cancelled can really add up. The same goes for when an employee is hired and not equipped with the services they need to do their job on day 1.
5. Administrative EfficienciesAdministering a company’s IT environment can be a nightmare if you don’t know who has what, where they are, and how much it costs. Knowing this information alone can free up a significant amount of time.
6. Communication EfficienciesEveryone who generates a cost should be able to see that cost. If you don't want to show your employees the cost of what they use, you are eliminating up to 25% of the benefits. As costs are only seen after they are incurred, the only way to prevent future expenses is to train new behaviors in your employees.
In our experience with enterprise clients, providing end-users a monthly statement via email has been the most transformative in terms of behavior. The 25% reduction in usage is real.
7. Instant ROI of ProjectionsThe ability to grab the data as needed on the fly is a major driver of the value of an IT cost management system.
8. Real-Time Decision MakingMaking real time decisions can be as simple as an employee ordering her own roaming package or making a decision to transition server space over to the cloud.
Looking to take cost transparency to the next step?