IT costs are an expensive element of any organization’s budget. Rising IT costs are something that all businesses must contend with. Why? Simply because IT is the driving force behind digital transformations and the creation of new products, services, and opportunities to connect with more customers.  


Reducing IT costs seems very difficult. Many business and technology leaders struggle to meet demand while managing a tight budget. Whether you’re a small or a large business and whatever industry you may be from – assessing IT services and solutions is the key to improving business efficiencies and driving out unwanted costs. 


The IT department is certainly not the one that can be starved of resources at this very crucial time of digital business evolution. Investments must be done to ensure the timely effectiveness and value of an organization and its products and services. 


Let’s consider five ways to lessen IT costs without undermining competitiveness and value – 

Reduce IT Cost - Gartner Stat

Reduce the Number of Projects 


Some organizations are re-evaluating the number of IT projects allocated to control costs. To complete these projects, companies often hire new staff or sometimes even pay overtime to their existing staff. It is crucial to make the right choice whilst determining which projects to take on.  


Although, you need to be careful about what projects to not go ahead with, projects that yield results and transforms the businesses such as the development of innovative technologies, could be worth the investment. On the other hand, projects that merely support business operations like upgrading internal technologies could be candidates for going on hold. 


Embrace the Cloud 

Switching to a cloud-based solution considerably reduces capital, setup, labor, and expansion costs in exchange for monthly costs. Many organizations that rely on on-premises infrastructure can save a considerable amount of IT costs by moving some or all their applications and data to the cloud. Migrating programs and data to the cloud means getting more uptime for less. 

Reduced costs for IT maintenance, IT support services, staffing, and security, as all these things can be handled by the cloud services provider for a predictable monthly fee. There’s little wonder about the reasons cloud adoption is so widespread. Earlier market research by Vanson Bourne revealed that the cloud helps companies save: 
16.18% of operational costs 
15.07% of total IT spending 
16.76% on IT maintenance 


Virtualization decouples software from hardware by disconnecting the link between applications and the resources needed to run them. It allows organizations to use virtual infrastructure, rather than physical hardware, to run applications and software. By pooling together resources such as storage, computer processing, networking, etc. and allocating the complete power through virtualization, applications receive power as required, meaning all resources run at their peak capacity that in turn decreases the amount of hardware required to facilitate applications.

One of the most remarkable reasons for virtualizing IT infrastructure is preventing downtime. In a virtual environment, if one application or resource fails, there’s a backup of IT assets ready to act as failover support. Downtime causes organizations and businesses to lose hours of operation, which leads to impact on reputation and potential loss of opportunities.

Benefits of Virtualization –

  1. Saves your investments on IT Hardware
  2. Requires low power consumption
  3. Offers you centralized management of your IT operation, and
  4. Offers more reliable and secure solutions as opposed to non-virtualized environment

Consider a Manager Service Provider (MSP)

Small to medium-sized businesses often find outsourcing to be a great way to reduce IT costs.

Managed Service Providers (MSPs) can manage, host and maintain an organization’s IT infrastructure more flexibly and efficiently than what SMBs can accomplish in house.

The MSP model is an IT service company that offers managed services to customers and organizations on a proactive basis. Most of the MSPs not only own the entire physical back-end infrastructure but also provide resources to their clients.

And all of this is remotely performed over the internet thus helping clients cut costs besides enhancing their operations. Meaning, the operational expenses are only incurred based on the actual capacity and usage, as opposed to the large upfront capital investments related to purchasing on-premises infrastructure.

Reduce your costs with DevOps

DevOps has a reputation for increasing the quality and speed of the software releases that in turn reduces IT costs, too. Consider Infrastructure-as-a-Service (IaaS), a pillar of DevOps. It not only automates the process of creating new development and test environments, but it also dynamically adjusts the computing resources used, thereby reducing labor cost. Meaning you can efficiently run more severs during usage spikes but not pay extra during slow hours.

Tip: If you swap containers for traditional virtual machines (VMs), you’ll squeeze even more computing resources out of fewer servers.

Implementing test automation in continuous integration and continuous delivery (CI/CD) pipeline is another saver. Functional testing roughly takes 2 to 3 hours when manually performed, and the automation script for the specific task doesn’t require frequent updates. This investment in automation would cut labor hours.

However, one thing to keep in mind is that DevOps savings do not come instantly. A full DevOps “transformation” takes approximately about one to three years for small business and three to seven years for large MNCs.

Reduce Turnover and Streamline your Workforce

Companies need to support their IT teams, ensuring that they have the necessities and that their workloads are manageable. An increase in employee contentment will help reduce turnover and save big bucks on recruitment and training new members of staff.

Even when departures occur, it’s important to have a cost-effective strategy to substitute them. Instituting a solid internship program is one way to do this, as is promoting from within, and looking first to hire new graduates from a local college you’ve established a relationship with, as this can be a great way to discover new talent and ensure staff grows alongside the company.


Implementation of the above practices does require research and planning. However, the effort is nothing compared to the long-term cost savings you can accomplish. The fruits of cost optimization will be very sweet when they will be used for growth and business innovation opportunities.

If you’ve already thought about any of the ways above, you’re probably ahead of the curve. It’s quite evident that there is no single solution to IT cost reduction. Considering at least one of the above is better than none.

To explore how V2Solutions can help you with cutting-edge and cost-efficient solutions for your business needs, Visit us here.

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