Avoiding IT cost blow outs

Matt Blowes April 21, 2015 Cloud Services, Managed Services

New work project? You might need new IT systems and support.

These investments can come at a cost and if you’re not careful, they may cost more than the project itself.

That’s what the Department of Social Services discovered with its failed “Stronger Relationships” trial, offering $200 vouchers for couples in failing relationships to seek counselling.

The program spent almost 50% more on IT than the vouchers themselves. The actual amount handed out to couples was $846,600, yet the IT spending on the project was over $1.2 million.

Most of the IT cost came in the project's first year. It may not be the case here but this often suggests a significantly high set-up cost relative to on-going maintenance. But could the department have taken on the risk of the program without the risk of expensive IT infrastructure going to waste?

How-to avoid cost blow outs

With a traditional ad-hoc IT project, we know the cost of an initial outlay on IT infrastructure can quickly balloon. Replacing or installing new hardware can rack up significant costs for potentially inadequate or more than sufficient results. Working out what your business needs to get the job done can be confusing and eat-up a significant amount of your business' time.

Before long you'll be wondering if you're spending more time on IT than on your actual business.

Subscribing to a managed IT service and deploying a cloud-based solution can take the guess-work out of IT spending.

Instead of worrying about the hardware or software your business needs, clearly defined benefits and objectives are set to reach your business targets.

Using the cloud, the cost of IT investment is spread out over the life of each project compared to a high or even prohibitive up-front fee.

Your managed IT service provider then does the hard work by developing and deploying a solution to meet your goals.

 

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