Tech cost
is ever-increasing,
so companies ask themselves,
how do my tech costs compare to my peers?
Based on our experience for more than 3,000 projects,
15 to 40% of tech cost can be reduced.
There are five to 15% within the first 12 months.
30 to 50% of cost reduction can usually be done
within the IT function, the tech function itself,
whereas 50 to 70% require a joint effort with the business.
So you may ask yourself now,
how do I realize tech cost reduction
and how do I optimize tech cost?
There are two different types of levers,
levers that the IT function can realize internally,
for example, vendor optimization, vendor renegotiation,
vendor consolidation, as well as license cost optimization.
On the other side, there are levers
that require the consent from the business.
For example, project portfolio optimization,
application harmonization,
consolidation and decommissioning.
This is a little bit harder to realize
because it takes more time
and usually also more negotiations with the business.
Determining what the cost position is
of the company against peers is a no regret move
with a very high ROI,
and it's essential to realize the cost savings
that are possible to either increase the EBIT
or reinvest them to maximize ROI.