Keeping costs to a minimum is a key requirement for all organisations, especially in these times of economic difficulty and increased competition. Getting a real handle on the current costs is a useful place to start, which in a large organisation itself is often a challenge. Once this has been achieved, however, it is easier to start to understand where costs can be reduced to provide sustained efficiencies and have a long-term impact on the business, rather than short term tactical cost cutting that can even prove harmful in the longer term.
Understand Your Costs
EAS help organisations capture, derive and understand the costs of different elements within the business; for example, the cost of a process is made up of a number of elements including the people, applications, licenses, costs of the underlying technology etc. In addition to providing a structure for the on-going capture and management of these costs EAS can also provide clarity on the distinction between the actual cost of a service vs. what different areas of the organisation are charged internally for that service. EAS utilises its Cost Management Service to assist in the challenge not only of understanding the different costs and structures but also in keeping them up to date.
Manage Your Costs Better
Once costs are understood and under control a cost management exercise will aim to reduce costs and increase profits in a planned and sustainable manner that will encourage rather than inhibit long-term growth. There are many different ways to achieve this aim, depending on the type of organisation and the products and services it offers. There may be opportunities for rationalisation, process re-engineering, re-negotiating partnerships etc. Experience has shown EAS that at this stage developing a strategy for cost reduction and executing this strategy by applying the techniques associated with managing change, such as IT Portfolio Management Planning and Execution, Service Portfolio Management and Project Portfolio Management are crucial for ensuring successful delivery of the long-term benefits that have been identified.