Tangoe: Technology Expense & Lifecycle Management
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IT Cost Management: DIY or Outsource?

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When it comes to governing IT costs, deciding between a Do-It-Yourself (DIY) approach and outsourcing comes down to careful considerations around:

People: Skillsets, staffing costs, time-to-hire and train, and employee retention

Process: Best practices, proven workflows, playbooks, templates

Technology: Tools, integration, automation, cost of new platforms

At Tangoe, we like to simplify this decision by framing it as an equation for success, defining how much of the project depends on people, process, versus technology.

The Success Equation: IT Cost Management

Technology is a smaller factor, because with artificial intelligence it’s fairly simple to expose IT costs and service usage data. The most critical parts are the expertise needed to turn that information into cost savings opportunities and the response process — the actions needed to turn potential savings into real dollars saved. With IT talent shortages increasing year over year, as much as 52% of identified cost savings are never exploited. That’s like cutting your ROI in half.

50%

people

20%

process

30%

technology

Expertise and process represent a total 70% of the success equation, whereas just 30% of success stems from the technology needed.

IT Cost Management: 3 Reasons Not to Go at it Alone

Three key logistical challenges can be difficult to overcome with a DIY approach. 

Default Dashboards Don’t Help You Optimize

The core issue is the one-sided financial relationship between IT service providers and clients. Providers have little incentive to help clients cut their costs. So, it’s no surprise that default dashboards and service usage reports don’t deliver the insights companies need to save money.

That puts the burden on clients to take their raw data and either manually evaluate it or try to apply advanced analytics to find their potential cost savings. This can be a heavy lift. Why do it yourself when ITEM providers have already built that AI engine for you?

Automated Processes means Faster Time-to-Savings

When it comes to optimizing costs, speed is everything. Every week that it takes to optimize your services represents a lost opportunity to save money. Few companies have automated their IT cost control measures, invoice administration, and contract management in ways that surface clear cost savings recommendations and hasten response.

Meanwhile, ITEM providers have invested millions in automation. Tangoe processes 370,000 invoices each month and has 65+ patented ways to speed data capture, verification, and information processing. We also automate reports to flag common types of overspending.

Expertise Eases Burdens and Moves Companies Past Cost-Cutting Basics

Expertise is particularly helpful in maximizing ROI on technology investments. Experienced IT cost management professionals help IT and financial leaders:

  • Move beyond basic cost comparisons, using price-per-feature insights and trends in how you use your services to make smarter cost-cutting recommendations
  • Contextualize your cost management strategy with industry intelligence — Tangoe oversees $34B in IT spending, so you’re not making budget decisions in a vacuum
  • Bring in negotiation artists to renew your services and handle RFPs, getting you the best price alongside the best contract terms
  • Catalog and maintain the official database of your cloud, mobile, and telecom services as well as all your mobile devices

IT Cost Savings are Elusive without Operationalizing Them

At the end of the day, operationalizing a cost management program is the key to success. Don’t let DIY jeopardize your ROI. Tangoe customers save an average 20% on their IT costs and recognize triple-digit ROI in the first year. The cost of an IT expense management solution is quickly outpaced by savings.

Talk to an IT cost management consultant today.