AKIBIA'S PRACTICAL GUIDE TO ENTERPRISE TECHNOLOGY
Monday, April 06, 2009
Consolidate Support Vendors?
The inability to predict a specific end date for the recession puts major stress on already strapped IT budgets. In past downturns many companies hunkered down and just held back on purchases until the economy started moving again. That strategy will not work this time. This recession will require IT to tighten the belt and really do more with less.
IT has to accomplish three things
- Reduce costs
- Increase current IT efficiencies
- Manage risk
In doing this we should consider the real possibility of looking across our existing outside service, support, and maintenance base to determine where we can consolidate vendors. Consolidation does two things, it gives us bargaining power that allows us to greatly reduce costs and it reduces complexity which minimizes risk and increases efficiency.
Go into this exercise with the goal of reducing existing vendors by 50% - a number that will better ensure significant efficiency gains and cost reductions. Much like any project, start this exercise with a set of goals in mind and share those goals with your perspective vendors. Include timelines so that you can work to a schedule that will set the tone for a successful outcome. It is not unheard of to negotiate longer service commitments for reduced cost. It is important to make sure negotiations remain professional and you come out with a stronger partnership with the service provider you retain.
Has anyone considered consolidating support vendors to reduce costs and improve service? What challenges and issues are you facing?
