Here are some ideas of immediate costs savings on E&P IT/IM. Take
advantage of the ‘costs’ environment at the moment to find
savings which actually have a positive impact on business function.
Each idea below can be backed up with verifiable examples from NDB’s recent activity.
ACTIVE APPLICATION MANAGEMENT Savings: The smallest company can reduce license costs and maintenance by
$100,000’s. For larger companies the savings can be in the millions. Savings are
repeated each year. Reducing complexity makes support more efficient. Users can
focus skills development and knowledge capture on the core tools.
Timing: Savings can be apparent within days. Reducing license costs is a year on
year direct saving.
What to do: Tie applications to business process and identify owners. Work with the
owners to classify applications. Licenses can be reduced for redundant and
specialist applications. Consider maintenance holidays on other applications (15%
to 25% of purchase price).
Why isn’t it being done already: Requires effective engagement between the
business and IT.
VALUE OF ASSET – DATA DELTA Savings: Whether buying or selling a 1% delta based on data quality is worth
$Millions. Buyers finding poor data will factor in a risk discount on the quality of
interpretations. Buying incomplete, poor or data requiring transcription can delay its
availability to the operations for months.
Timing: Where you are engaged in A&D activity. Payback is per transaction.
What to do: Engage early in the A&D process. Provide expertise to ensure data
quality and data completeness and provide the delta calculation to the
negotiators. When selling ensure the package is complete and fully supportive of
business value claims. Always ensure data is held in ‘asset’ sets.
Why isn’t it being done already: Teams engaged in A&D activity don’t engage with
SHARED SERVICES – WHAT IS SAFE TO SHARE AND WHAT YOU SHOULD KEEP? Savings: For smaller companies the savings may be equivalent to 2 or 3 FTEs,
repeated year on year. For larger companies $Millions are saved year on year by
evaluating different service offerings. Can include Systems Infrastructure, Data
NDB 3 Brilliant Ideas for Effective Cost Reduction Storage, Data Loading and Data Management services, Application License,
Application Support, and Project Services.
Timing: Savings can be immediate or may require a short tender process or
implementation project.
What to do: It is essential to understand what is value added and what is
commodity. Understanding comes from evaluating the data and applications
applied to the business processes. Keep tendering and projects to a minimum and
reward on savings delivered.
Why isn’t it being done already: For smaller companies there is a concern about
losing control or relying on third parties. For larger companies it is an established
activity however not enough focus is given to the ‘value add’ in the business
process and mistakes are made about what is commodity. For larger companies
who already have shared or outsourced services the quality and cost effectiveness
should be reviewed.
Contact Ed Evans at [email protected] to chat NDBTEAM.COM #NEWDIGITALBIZ NDB 3 Brilliant Ideas for Effective Cost Reduction