USE IT AS A LEVER TO CUT COSTS

2010-10-22T16:49:00.002+05:30

The global economic slowdown is testing businesses across the board. Be it small and medium enterprises, large enterprises or individual consumers, each one has been affected by the multiple factors at play: decelerating demand, price pressures, lower availability of credit or simply a depressed market sentiment driven by a slowing down of retail and white goods sales.

The IT industry too is witnessing a ripple effect. Yet, the impact is not necessarily negative. There are some clear bright spots emerging within the gloom as businesses are eager to explore ways to leverage technology to help them cut costs. We are in fact seeing a greater interest in solutions such as datacentre consolidations, storage virtualisation and server optimisation that enhance cost-effectiveness. Datacentre consolidation is one of the most fundamental ways to lower the cost of IT operations. Larger data centres are cost-effective only on a per-unit basis. Therefore for many organisations, consolidating storage across all platforms proves to be an effective way to reduce management and maintenance costs.

Similarly, virtualisation goes one step further and pools together all resources into a more efficient virtual environment. It moves the computing workload from physical servers to a smaller number of virtual servers, allowing IT departments to leverage their storage, network, and other computing resources to control costs, simplify deployment, and respond faster to business needs.

Even server optimisation that often requires considerable upfront planning, time and effort, involves retirement of old or underutilised hardware, savings in floor space and power consumption and an overall reduction in total cost of ownership.

There’s a lot of interest in blade technologies indicating that consumers want to rightsize for today and yet keep head room for tomorrow. Blades now go beyond solving server issues to solving infrastructure issues. Combining the basic blade components with advanced management software can help consumers run an entire small business—combining storage, network, management and applications into one solution—as well as support all the IT needs of a Fortune 500 company. Blade servers will be most welcomed in large data centres where smaller space requirements and reduced energy consumption can translate directly into lower operating costs. No wonder, hailed as a solution that can increase ‘green’ computing, improve server management and cut costs, blade technology is being called on by an increasing number of organisations.

At such times, tighter budgets and unrelenting competition is propelling companies to become more efficient triggering a growing interest in process re-engineering. In fact, it is heartening to observe that the general sentiment reflects that recession is an opportunity for far-sighted companies to reinvent themselves through business improvement practices. There is a realisation today that simple cost-cutting measures are not really effective. Instead, it is prudent to review business practices for long-term survival, a practice that would also bolster the company from within for the next wave of growth.

Today, the most common questions we are asked are: How can IT help drive down cost in operations? How can IT prepare us to be ready for an upswing when it comes? Truly, it is important to avoid knee-jerk reactions to the recession and instead consider the long term impact of each decision. Actions that seem attractive for cutting down costs during the current economic scenario might just backfire in the future when the economy rebounds.

While recession brings hard times, businesses that arm themselves with the right technology and the right mindset can still perform better. Indian businesses are treating this downturn with caution but continue to explore opportunities within the downturn.

The questions, interest and demand for relevant solutions to help secure the bottom-line despite top-line pressure all point to the fact that businesses will continue to welcome investment in technology, wherever it can help them keep their long term strategy on track.

VIRAJ Y MAHESHWARI

USE IT AS A LEVER TO CUT COSTS