Companies in the UK are literally throwing away thousands of pounds on the support and maintenance of their IT systems rather than streamlining them to better suit their business, according to K3 Managed Services.
They are one of the leading suppliers of Microsoft based business solutions in the supply chain, and have also said 50% of businesses have more on their IT systems than they need, making them complex environments that are very expensive to support.
That’s the message delivered by the fourth monthly “Business of IT Guide” published by K3. The guide reminds directors on the importance of strategic IT budgeting and states that reducing the complexity of IT mitigates the risk of overspending and wasting money on maintaining over complex, yet inefficient systems.
According to research firm Forrester, companies are starting to invest more in IT innovation. In its latest Forrsights Software Survey, Forrester reveals that 12% of businesses planned to increase their software budgets by more than 10% in 2011 and a further 10% by between 5&10%.
However, a high proportion of IT budget is still being consumed by software operations and maintenance. K3 has found that over half of companies’ total IT expenditure is being spent solely on maintaining systems, with just 24 per cent of the budget spent on IT innovation.
K3’s guide reminds directors that it is not just about setting a carefully constructed IT budget but implementing it properly. IT spending must be aligned with available new technologies, sustainability and ultimately, moving a business forward.
The expansion of IT systems to support existing software has many hidden costs, including the energy required to power extra servers and devices. Analyst firm Gartner predicts that by the end of the year, the cost of power and cooling will surpass the cost of hardware. Reducing energy goes hand in hand with simplifying the complexity of your IT.
Jason Price, Head of Sales at K3 Managed Services said: “Businesses are still in the habit of spending money on additional hardware to support existing IT systems, instead of streamlining their IT and freeing up funds for IT innovation.
It is not a case of bigger is better. Often smaller, streamlined IT systems work better than those that rely on multiple hardware. The key is managing your IT budget to accommodate IT innovation and implementing that budget for business advantage.”