5 Strategies for Reducing Small Business IT Costs
We’re living and operating in a technology-fueled business world where even the smallest companies are required to build out IT infrastructures in order to stay current and competitive. But with the high cost of IT, many small business owners are left wondering how they can afford to continue without depleting their financial reserves.
5 Ways to Lower IT Costs
If your business is in a position where IT costs have become exuberant and oppressive, you aren’t alone. But thankfully, there are some rather simple steps you can take to slash these expenses while still adding value to your organization.
Let’s explore a few of them in further detail:
1. Try Contract Staffing
People are expensive. Go ahead and review your IT budget right now and you’ll see that salaries, wages, and benefits represent a big piece of the pie. In particular, it’s challenging to control costs when you fluctuate between busy periods and slow stretches.
“To save money, you can turn to contract staffing. You can maintain adequate staffing levels to handle the company’s slow periods. Contract staffing can then fill in the gaps and help you manage higher-demand periods,” staffing expert Courtney Gakman writes. “It may make sense to outsource contract staffing recruitment to save time and money. When a new project approaches, a technical recruitment company can quickly find contractors for you. When the project ends, you can let them go. This flexibility can help you keep your personnel costs under control.”
The more scalable you make your IT investments, the less you’ll waste on resources you don’t need, just so you can weather the slow seasons and wait for the busy periods.
2. Consider Forgoing Software Updates
Software maintenance can get expensive. After just five years, the average company spends more money on maintaining and updating software than they did on the original purchase price of the software. And it’s for this reason that a lot of companies are opting to perform fewer updates. (Cloud SaaS is obviously another solution. When you’re operating on the cloud, most updates occur automatically and don’t cost you a dime.)
3. Leverage a GPO
As you know, small businesses often face a disadvantage when it comes to purchases. Because of your small size and limited purchase needs, you don’t always qualify for the same bulk discounts that larger organizations do. This increases your costs on IT expenditures and limits your ability to generate the necessary ROI. But what if there were another way?
Consider joining a Group Purchasing Organization, or GPO, which works a lot like a Costco or Sam’s Club. A GPO is basically a network of businesses that band together to maximize their purchasing power in order to receive significant discounts and savings on the products and services they purchase – including hardware and software.
4. Try Telecommuting
IT is one of those fields where you don’t always need your team to be physically present in the same environment. This makes it the perfect industry for telecommuting.
When employees telecommute, you don’t require the same square footage, which allows you to save on office space. You also consume far fewer utilities. Then there’s the added benefit of more satisfied employees, which theoretically results in greater productivity and less turnover.
5. Automate Certain IT Services
Be mindful of how your employees are using their time. Are there certain tasks you can automate to better utilize time and save money?
“Automation and machine learning tools could reduce or even eliminate these huge ongoing IT costs,” IT pro William Goddard writes. “Algorithms – even chatbots – can be used to personalize permissions for new hires and existing employees. Machine learning solutions can be utilized to monitor events and automatically refresh printers and other IT equipment without staff having to get involved.”
Depending on your industry, you may find half a dozen or more tasks that can be automated. In doing so, you’ll increase efficiency, lower expenses, and add more value to the bottom line.
What’s Your Game Plan?
As you can see, it’s possible to lower IT costs and still add value to your business. The biggest challenge is determining which methods you’ll implement and how you can strategically shift your approach so that you continue to maximize operational efficiency while simultaneously enjoying lower expenditures. It could take months to figure out the perfect blend. Slow down and patiently wait for the right results.