Obtain Inventory Information
A very important and often overlooked step (Step 2) was to obtain the information and inventory.
This step is critical when beginning to look for cost reductions in the technical infrastructure area. Without an accurate inventory, you will make cost savings decisions on hunches or perceptions of what is in place and how it contributes to costs. It is important to know what your services cost. You also must understand what infrastructure components are required to support typical applications and what components you share across services. As you will see later in this chapter, it will also be critical to have an accurate inventory to ensure vendors are billing correctly for services.
Some companies may have a fully populated Information Technology Infrastructure Library (ITIL)-based Configuration Management Data Base (CMDB) or other type of database in place with all relationships among the IT items established. If not, do not attempt to create such a CMDB as an initial step like this is a large and complex effort. Initially concentrate on establishing enough information in a database or spreadsheet to manage resources and audit vendors' invoices. Then, implement processes to ensure the information stays up to date as you make changes to the infrastructure. Later, you can develop a CMDB or similar type database.
Develop Prioritization Scheme
Step 3 of the cost reduction to analyze the costs. Develop a prioritization scheme for the IT infrastructure. A prioritization scheme helps identify where you should look for infrastructure savings and where you want to avoid cutting back. Tier the infrastructure components to indicate the priority to the corporation. Figure 1 provides an example of an infrastructure prioritization framework. The exact prioritization scheme would vary in the number of categories and tiers for each company. Tier 1 applications would be areas in which the business stops if they become unavailable. Examples of infrastructure areas that would merit a tier one rating are components that support applications critical to the business, such as the search engine would be for Google or infrastructure components for airport passenger check-in programs would be for an airline. The bottom tier would be equipment that supports systems that you consider noncritical to business operations. Examples of noncritical systems would be an accounts payable system, help desk software, or a sales projection system. What may be noncritical for one company may be critical for another. While these are important systems for the organization, the business will continue to function while these systems are down. The importance of each tier and column vary by company, as company systems and locations will vary.
Entire company | Major site | Minor site | |
|---|---|---|---|
Tier 1 applications | Data center, key applications | …. | Customer facing location |
Tier 2 applications | …. | …. | …. |
Tier 3 applications | …. | …. | …. |
Tier 4 applications | Supply ordering | …. | Small remote site |
Figure 1: Infrastructure prioritization framework
Making infrastructure changes to reduce costs is risky. One approach that lowers risk, if you have the time, is to start cost-cutting activities on lower priority infrastructure areas. You will then gain experience in these areas with minimum or no impact to critical business areas first. As you gain experience, and staff skills are developed, you and upper management will have the confidence to attack cost savings in more critical infrastructure components.
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