IT Cost-Saving Measures for SME and LE Enterprises

The recent economy crisis has plunged several countries into worldwide global recession. Those that are yet to be in the state of recession will find themselves to be into one soon. Hence, how does this affect the businesses and enterprises over the world?

Collapse of the 150-year-old Lehman Brothers is an example illustrating that there is no such thing as job stability, business security, etc. In this millennium, it is truly the survival of the fittest - the company that is capable of  the highest turnover in the shortest period of time will ride the tide. This does not necessarily appeal to the large enterprise (LE) market segment, but also to Small and Medium Enterprise (SME) businesses. As a C-level personnel, particularly a CIO, CTO or Vice-President of IT, what should be your next step to uphold the stability of the company.

(click here to find out some tips to ride the tide of the economy downturn...)

Here are two possible IT solutions that could help reduce cost over the long run:

VoIP Solution

VoIP or Voice over Internet Protocol is a net telephony solution that replaces the traditional Public Switched Telephone Network (PSTN) telephony system by Internet (broadband) means. This solution is exceptionally helpful and economically viable for SME as well as large enterprises who foresee a long plan ahead, and for businesses that is constantly in touch with the global market.

For example, making long distance international calls can cost a SME company up to S$9,500 a month. One such company that provided this quote is Razer Asia-Pacific. After switching from SingTel's (a local Telco company) premium 001 service to using MediaRing's (another local Telco running VoIP) 1551 service, it has subsequently greatly reduced the monthly bill to a low of S$950! That is a massive 10 percent value of what the company used to pay.

Most LE companies would have VoIP system in place, it is perhaps time for SME companies to follow suit.

Virtualisation

In this case, viritualisation is more applicable to medium enterprises and large enterprises. It may also apply to small enterprises, provided they run more than one servers that power their businesses.

Think of virtualisation as sharing of computing resources, or rather think of it as splitting one physical server into multiple servers in a way each server can be utilised for different functions. With the growing demand of applications and computing powers, for example enterprises are now looking towards Customer Relationship Management (CRM) softwares to manage their businesses, hardware comes at a great cost. There will be a need to dedicate servers for various applications.

Do not underestimate the power of virtualisation. With this technology, it can help your company to reduce cost by a great deal. In many situations, servers were only 5 to 10 percent utilised, leaving the processes unused most of the time. Most tapped servers perhaps only hit 40 percent of the processor's capability. Besides, deploying 100 servers across different countries and regions means high cost of leasing. In addition, cooling of servers also add on to the electricity bills!

A case study of O2 Micro, a global computer chip design firm, revealed that the firm has avoided paying S$40k in electricity bill per year, and is now paying about a-third of it. From the IT point-of-view, what would normally have taken 20 hours to deploy servers (and install software), would now taken only 4 hours to complete. That is great time-saving effort as well, since in the corporate world, time is money.

When it comes to licensing issue, positive outlook also can be derived from virtualisation. For an instance, in the case of computer-aided design (CAD) software, instead of purchasing license for the all the users, the company will buy only a few of them. The savings came about when the virtualised servers allocate idle computing resources as an when they were needed to the right users; in this way, no single user hogged on to the CAD license full time.

As technology advanced, company should also look towards cutting-edge technology as part of cost-saving measures. Recently, I have heard several news of implementing retrenchment as a measure to save the company. I just wondered, could there be anything else that can be done; that should be the last resort as no one would like to be out-of-job.