The start to 2020 has not been a pleasant one, to say the least. In fact, the COVID-19 pandemic has caused the stock market to crash with no end in sight. Travel and sporting events have been banned or canceled, and companies are having to reset earnings expectations, given the material impacts to supply chain, global trade, and sales. The government has committed to a stimulus package, but investors aren’t confident it will help or give us the boost we need to recharge the economy.
How long will this health scare and financial crisis last?! No one is in a position to confidently say when it will subside or if matters will ever return to the status quo.
No matter the health of your company’s balance sheet (e.g., cash-heavy), it’s important to instate proactive IT vendor hygiene to ensure your company is in a position to optimize technology costs and reduce vendor risks during this unpredictable time. CxOs will begin to care just as much about spend as they do speed during this economic climate. Rest assured, IT suppliers will become more aggressive with software audits in order to make up for lost revenue with traditional sales and partner channels. Not having a good handle or insight over your vendor deployments can put you in an unfavorable position when the auditors come knocking at your door.
Lower Your IT Contract Exposure
Start now. Don’t wait for your next contract renewal, as you’ll have less commercial leverage. Begin by prioritizing your high-risk vendors, but don’t forget about the tail spend suppliers, who may become more opportunistic than the mega-vendors. Partner with your SAM team or a viable 3rd party to measure your software installations and usage, reconciling to your contract/purchase entitlements. Find out your software compliance risk areas, along with any opportunities to right-size your IT environment through unused software and support. Ensure you understand your deployments and future needs. Then, create a playbook and proactively reach out to suppliers. They want to preserve the relationship with your company and be in a position to mutually prosper when the market improves.
Address your cloud suppliers with a similar approach. Check your compute and storage workloads. Review application demand with key stakeholders, and if you anticipate a slowdown over the foreseeable future, decrease your public cloud sizing which can lead to immediate IT OPEX savings. Don’t be shy to realize the elasticity benefit that is often touted by public cloud vendors (e.g. AWS).
This sounds great, but you may not have the time, resources and/or budget to perform this necessary due diligence or IT vendor hygiene. Given the current COVID-19 pandemic and its impact on the global economy, your leadership will listen to any possible cost-cutting measures to help “keep the lights on” and maximize ROI on technology investments while faced with new challenges – as waiting can be detrimental to your business.
Contact us today to learn how you can start reducing your IT costs: email@example.com.