Are uncontrolled costs casting a shadow over IT?

Many enterprises faced a brutal 2020. Fortunately, urgent workfrom- home arrangements have largely succeeded, thanks to cloud resources that made virtual communications and collaboration the norm.

But now’s the time to check whether IT resources and workflows are supporting your organization at the right level, doing what they should, and costing what you expect. The long-term reverberations of the pandemic are creating additional financial uncertainty, which puts cost control in the spotlight.

Take these five steps to regain control of software, hardware, and cloud assets.

1. Gain a complete view of IT resources to understand spending patterns

You can’t manage what you can’t see. You also don’t want to pull the plug on cloud or software assets that are providing business value just because they’re user-provisioned rather than above-board. And it’s important to be aware of the pitfalls of so-called optimization tools that may be costing you too much to use and failing their core mission: reducing spend.

The problem is further complicated by the fact that siloed cloud and software systems and services don’t lend themselves to a clear view of spend. The remedy is a unified dashboard that cuts across traditionally disconnected processes and legacy systems and acts as a single source of truth, allowing you to see a full picture of expenditure, including:
• Software licences, used and unused.
• Cloud resources across cloud infrastructure, platforms, and software (IaaS, PaaS, and SaaS).
• Shadow IT and sanctioned systems.
• On-premises, hybrid, and public cloud services.

Gaining this single view then lets you plan the next step — deciding what’s fat to be trimmed and what’s vital to the business, so you can regain control of spend.

2. Detect overspending on maintenance from outdated systems and unused licenses

• What legacy systems, including software licenses and maintenance subscriptions, are in use? Which could be phased out or are unused and forgotten?
• Are there cloud options for outdated legacy systems that you can migrate to, or bring your own licence (BYOL) as you host software in the cloud?
• Are you paying third-party support and maintenance partners whose contracts cover services no one’s using?

Legacy system costs may seem minor in the broader IT budget, but every cost is under the microscope now, and proactive action to root out spend that could be in the millions will show the business that IT is serious about cost optimization. It also gives you the chance to reassign budget to innovation and transformation projects now, before it’s reassigned from you.

3. Identify and act on unauthorized IT spending across the hybrid environment

Let’s put aside for a moment the fact that unsanctioned hardware, cloud, and software tools increase risk and complicate the IT support burden. We recognize that many individuals and departments circumvent the IT team because they don’t believe it can meet their needs.
For a long-term solution, it’s essential to engage management and leaders from all departments in regular meetings to understand their changing requirements, especially in this unsettled time. IT can then do what it does best: match business needs to proven, up-to-date resources that best get the job done.
In parallel, IT should use its unified dashboards to pinpoint people and business areas who are repeat offenders in self-provisioning, as well as the unsanctioned systems, services, and hardware assets in use. Tools like the hardware asset dashboard let you rapidly uncover the unknown portion of your IT estate, so you can secure it. This lets you focus engagement, identify what’s out there, and plan how to meet user needs quickly — and within official policy for security and support.

4. Extend IT visibility and intelligence to other teams

Once IT achieves a single view of costs, identifies spend on unused or legacy systems, and assesses the company’s shadow IT posture, it can extend this intelligence to the full enterprise.

This is part of the same commitment to engagement with management and department leaders that we see in Step Three. It’s about empowering colleagues to commit to IT cost efficiency, too, by showing IT utilization via easy-to-understand dashboards. Team and departmental leaders can
see and understand where their IT costs are located, and spot opportunities to save.

The intelligence should also be extended to the C-suite. This free flow of intelligence, across traditional department boundaries and silos and up to senior management, ensures that all the right people are working together to take a holistic approach to cost optimization.

5. Commit to continuous optimization, at scale
Cost optimization is not a one-and-done event: both optimization and cross-enterprise engagement on IT requirements is a way of life.

To regain control of IT costs, both engagement and cost optimization must be ongoing, identifying short, medium and long-term business needs, and ensuring the best technologies to meet those. Today, cost control is one of the most urgent needs: the emergency of 2020 has users already reporting that they’re exceeding their cloud budget by an average of 23%.

The onus is on IT not just to gain the visibility to reduce expensive problems like shadow IT, but also to adopt methods that let you continually right size the environment. This will lead to optimizing other areas of your IT asset management (ITAM) practices to save money, such as automating your hardware lifecycle to find and eliminate waste and reduce the risk related to assets gathering dust in the corners of your business. Rigorous hardware asset management (HAM) also lets you plan ahead, reducing replacement costs by eliminating the need for extended support.

Automation is a must here, including policy-driven workflows. For example, you might create a workflow that runs whenever a user requests approval for an item they want from the service catalog. Efficiencies arise from the fact that activity can have different transitions to next-steps, depending on outcomes. If the catalog-item request is approved, for example, the next activity is notifying someone to order the item. But if the request is denied, the next step should be to notify the user that the request wasn’t approved. Policy-driven workflows let you exercise close governance — while never leaving users short of resources.