Promote Your Blog IT Management Blog: January 2012

Wednesday, January 25, 2012

Data Center IT Cost Saving ROI Thoughts


So I have been tasked with creating a new cost saving model to be used across the enterprise.
I wanted to share with my readers a few thoughts

Some of the items this initiative should encompass will be electricity usage, cooling, virtualization, server refresh cycles, bandwidth costs, multiple data center replications,  WAN optimization, SLA's, training staff, equipment depreciation, asset tracking.

These are just a few of the metrics that can go into a well rounded presentation for upper management.  However before you dive in to creating a large formula heavy spreadsheet you might want to look at what’s currently available for starting point templates and references.

I recently ran across a fellow whom was tasked with this exact project.  While he was diligent and had many items well laid out in his spreadsheet I asked how long he had been working on this initiative.   To my surprise his answer was a whopping 3 months!!!!  Of almost 3 days per week gathering information and making new columns and cells with each discovered item.

In today's IT world the IT manager can be tasked with a multitude of projects and initiatives that need to get done.   These are often important projects to keep the business making money with a low overhead.   It’s up to all IT managers to turn their IT departments from a cost center into a profit center.  However before we get off track lets discuss what this fellow could have done.

#1.  Google is your friend, if you know how to use it.   Many folks don’t know you can type in the search box the following text.   Information Technology ROI Spreadsheet Filetype:xls
This search will yield many great results with proven formulas and graphs that really present well.

#2.  Look over your heating / cooling / electricity / ISP bills.  Do you really understand how to calculate the loaded cost for these items?    Presenting just what the bill states as a cost is really not the answer here.
Understand how each cost affects the company’s bottom line.

#3. Calculate the IT cost per employee.  Knowing how much IT costs the company for each employee is a real eye-opener!!!.   Many times we see employees whom are struggling thru spreadsheets and other systems because their knowledge was handed down from employee to employee.  More times than not the new employee was taught the wrong way.    An anonymous survey is a great way to learn whose struggling.
A training class goes a long way to increasing performance and ROI.

#4.  Do you understand how to calculate the depreciation of IT assets?  What’s the 1,2,3,4 yr depreciation rate?

#5. Another great area is printers.  Many times when I enter a firm I see HP printers in almost every cube.   Printer overrun is so costly to a company many are unaware of the hidden costs.    Looking into leasing a high capacity printer and enforcing double sided printing can lower costs dramatically.


While there are many ways to create your ROI presentation to Sr Management, you need to look outside and what’s around you as every environment will be different and have its own distinct characteristics.

These are just a few of the many tips one should consider when creating your presentation.   There are lots of great ways for IT managers to save on costs daily.

Dont just sit back but walk around the office daily looking for waste, it wont be far from your eyes to spot..........................