Six Tips for stretching IT Budgets; Positive and Negative Impacts of the Recommendations
Positive impacts of the six tips for stretching IT budgets
Much of effort and cost in most organizations originates from the re-invention and re-discovery of new software (Mugisa, 2000). It involves copy-pasting codes from the existing software to a new one. Since most hardware architecture is heterogeneous and diverse, systematic software reuse is the most viable way of gaining a competitive advantage at a lesser cost. It reduces the time required to develop new software and increases the overall quality. It allows organizations to leverage on the existing frameworks, patterns, components, and architectures. Old hardware reuse is the process of stripping down the existing organizational hardware, cleaning them up and reconfiguring them to create a newer system (Hsieh, 2010). Organizations incur millions of money replacing the old hardware with new systems every year, while the old hardware ends up being disposed off. Organizations can refurbish their old hardware into effective systems and channel the money to other strategic initiatives.
The technology needs for organizations have increased significantly, making it inevitable to have managed services. Maintaining the infrastructure to enable the organization to be competitive has become extremely expensive for businesses. To respond to this, organizations are contracting managed service providers (Jones, 2000). Other benefits that managed service providers offer the organization include the ease of infrastructure maintenance, cost benefits, and easy deployment. Managed service providers set up the infrastructure in hours compared to months or years that organizations could spend in setting up their own infrastructure, hiring the essential staff and maintenance support. Automation of organization-wide processes is a source of competitive advantage for businesses since it leads to the overall reduction of overhead costs. Since most automated systems have the ability to work for a long period of time, overall organizational productivity increases. Automation results in huge production that guarantees the organization profitability. Further, automation leads to accuracy, reliability, and consistency in business operations, giving the organization quality control assurance (Scheer, 2004).
Negative impacts of the six tips for stretching IT budgets
Systematic software reuse has failed in the past since it requires thorough knowledge of the software and the user requirements. Where the reuse groups are cost-centers, it is extremely expensive to support systematic software reuse (Mugisa, 2000). In addition, there are numerous administrative impediments to systematic software reuse, including difficulties in locating the reusable assets outside workgroups. Before they can embark on old hardware reuse, organizations need to assess refurbishing versus purchase decision. If the capabilities of the new hardware outstrip the old ones, then old hardware reuse is not a worthwhile option. It costs time and money to refurbish old hardware that it would have cost purchasing from new vendors hardware that are more efficient and effective (Hsieh, 2010). Most of the old hardware consumes a lot of electricity and requires maintenance services frequently, thereby increasing the operational cost.
Managed services pose reliability concerns for organizations since when the business wants to hire another provider to host its critical infrastructure; it has to replace calendars, emails, and other aspects without which it cannot operate (Jones, 2000). This can be a threat to the long-term organizational success and growth. Managed services offer businesses less flexibility since they do always meet specific organizational needs to certain standards. In addition, the organizational information is stored outside its infrastructure, which may not be acceptable in some sectors such as healthcare. Business processes’ automation has led to astounding improvements in organizations’ productivity. Nevertheless, it has reduced innovation since it exposes the employees to a mentally lethargic condition. For this reason, organizations are now looking for ways of balancing the numerous benefits of processes’ automation and the need for maintaining intelligent and innovative employees (Scheer, 2004). Many employees are yet to understand the fact that technology and automation are just tools for improving business processes.
Hsieh, Ai-Shan. (2010). Analysis of Drivers and Barriers for Institutional Old Hardware Re-use: A case study of secondary PCs in Taiwan. Lunds universitet/Internationella miljöinstitutet. http://lup.lub.lu.se/student-papers/record/1784754.
Jones, Wendell. (2000). Managing external service providers. Syosset, NY: WatchIT.com.
Mugisa, E. K. (2000). An approach to systematic software reuse based on plugging components into an architecture. New York, NY: ACM Press.
Scheer, August-Wilhelm. (2004). Business process automation: ARIS in practice. Berlin: Springer.