This is the time of the year when as usual there would be predictions for coming year, there would be lot of discussion about upcoming trends and as usual you – the CIOs – would be under pressure to actively consider these technologies to look good in front of your contemporaries and board members. At the same time, you would have gone through or might be going through some painful exercise of annual budgeting, trying to carve out dollars for these new, shiny technologies. We know it is not easy to balance operational budgets and new initiatives. You always need a strong business case and are accountable to show results. Hence justifying for additional budget (in short term) is not an easy task.
This is one area – how to find budget – is something that you can do by looking inside – inside your IT infrastructure. Following are the few suggested areas for your consideration:

 1. Take a look at the cost of proprietary software licensing and AMCs:

Proprietary software and their AMCs consume a lot of budget. Most of the CIOs are aware of this trend. Typically AMC and licensing costs take upwards of 50% of your budget and rest of the budget is consumed by operational, manpower and network costs. There is very little you can do about these ‘other’ costs. But you can certainly address the cost of licenses that you are paying for the proprietary software. There are alternatives in open source world and most CIOs are aware of that. However, from our discussions with many CIOs, we understand that this switch does not happen for a variety of reasons –  sometimes there is an inertia – “why to rock the boat if it is working” or sometimes there is a fear of unknown or sometimes there is a perceived lack of availability of manpower. However, the most dreadful thing that we have learnt from CIOs is that there is huge cost for not switching. At the same time, we have seen that those organizations which have started adopting open source softwares have gained in multiple areas and their CIOs have got very positive results. Hence take a stock of your existing costs and you would find areas to cut them.

2. Address ‘Once-in-a-while’ applications:

There are applications that are used just a few times per year for generating reports but they are mandatory for regulatory purposes. These applications consume licenses and AMC costs that could go as high as 10 to 15% of your budget. You can identify such ‘once-in-a-while’ applications in your infrastructure and explore how to release the licenses associated with such applications. One of our Telecom clients went through such an exercise and ported the application from Oracle database to PostgreSQL and proprietary Unix to Linux and in the process saved not only saved the license cost but also the maintenance cost for hardware.

3. Choose easily digestible options from among newer technologies:

It is important to bring in new technologies to address increasing business needs. However, it is equally important to choose those options from among the technologies that are closely aligned with your available skill sets. Reason is that ultimately it is your people who are going to carry the task of making newer technologies work for your organization. If there is a big variance from existing skills sets then it is very difficult to make people learn something that is not part of their career path. You have to then consider the option of hiring completely new set of people, which would push your costs down. Hence look inside your teams, look at their skill sets and map the options that your people can learn and deliver successfully.
Wish you a wonderful holiday season.