Cutting costs and increasing efficiency are paramount as the economy continues to suffer.
4. License consolidation of Productivity Tools
The truth about productivity tools is that organizations typically over-buy. Not only do the tools not get used to their full potential, and for some companies it never leaves the shrink-wrap. For many, it is no fault of their own. But it is, what it is. So take this opportunity to make some changes in this arena.
Evaluate just how often your team members are actively using their license(s). Consolidation here is a real and actionable opportunity. Be certain to canvass all of the users and share with them your attempts at reducing cost. Attempt to determine real "usage" time. This measure will help in making a good decision on consolidation.
Lastly, don't rule out Open Source. There are many good tools that are part of the Open Source community. Relieving your product vendor of their license fees and instead directing a small portion of those funds toward an IT service team that can deploy and manage an Open Source solution for you, may just be the right cost cutting measure.
5. Headcount consolidation around business functions
One of the "least common denominators" is the presence of similar business functions across multiple software applications. Take equity trading systems or claims processing, for example. The systems that support this business function are, on many occasions, siloed throughout an IT organization.
Consolidating a team that has similar business background may ultimately save some cost in headcount and effort. For example, instead of having two separate testing teams, which operate independently of each other, why not consolidate?
6. Refocus most the costly resources
There is an interesting opportunity here and a scenario that may not be applicable to all organizations. But for those where it is applicable, this can be a good opportunity for savings. When I use the term refocus, I'm referring to a situation where there are single resources doing multiple jobs and filling multiple roles.
For example, an organization can quite plausibly have its developer staff doing testing as well as development. The scenario might have developer roles doing application development 75% of the time and doing testing 25% of the time.
The incompatibility of those roles and that scenario aside, one might normally applaud this approach to leveraging a multi-talented workforce. The problem is that the developers, who typically cost more than testers, are spending 25% of their time doing "lower cost" work.
A cost reduction technique in this scenario would be to replace 1 out of every 4 developers with a tester. The presence of the tester would relieve the development staff of needing to spend 25% of their time on testing activity, thereby allowing them to work on development tasks; covering for the lost productivity of the one developer that was removed.
By removing one developer and replacing that role with one tester, actual cash outlay is reduced; assuming of course that the tester costs less than a developer. This technique can be scaled across an entire organization to leverage the cost savings that it holds.