IT spending is on the rise and so are the prices organizations must pay for leading AI, cloud, and mobile tools. As sprawling technologies and inflation consume larger portions of IT budgets, business leaders are growing increasingly concerned about their ability to sustainably innovate, including tracking spending, governing expenses, and stretching IT budgets.
Financial management practices are critical as organizations need to protect their technology assets and spend their money in ways that return the most value. But how do they manage their IT expenses without disrupting their business, and how much does it cost them to effectively optimize costs and asset utilization? Vanson Bourne’s research findings suggest one specific approach is superior in delivering results faster at a cost five times lower than the closest alternative.
We surveyed 500 IT and finance decision makers to study their IT expense management practices and unearth the value that third-party solution providers can deliver. Our research explores three approaches to IT expense management: fully in-house programs, fully external solutions (third-party service providers), and hybrid approaches (a mixture of in-house and external).
The respondents’ views and experiences make it clear that specific approaches and certain aspects are the trademark of a worthwhile and cost-effective IT expense management program. These include:
Respondents predict there will be double-digit spending growth over the next two years on top of existing cloud, telecom, and mobile budgets, on average. Increased expenditures are likely to be the highest for cloud infrastructure and cloud software but notable increases in mobile and telecom are also projected.
IT investments are key to remaining competitive. However, organizations are also at risk of losing their edge when it comes to managing cloud technologies. Cloud infrastructure is required to support digital innovation, AI and GenAI, but letting costs get out of hand or acquiring technical debt (by failing to revisit routine spending or rationalize new investments), is a sure-fire way to lose out financially and competitively.
As IT spending and complexity increase, so does the potential to get overwhelmed and overburdened with its management. The research shows that organizations are using around 39 IT providers across their cloud, telecom, and mobile services, on average.
What’s more, they are relying on numerous staff members to handle their IT expense management: between 60 and 80 employees on average are involved across mobile, telecom and cloud, respectively. These high numbers demonstrate why expert support is so crucial, because organizations are likely to find it challenging to have a unified and efficient management approach with information fragmented across many provider portals and so many different individuals involved.
A step in the right direction would be freeing up internal resources by taking on a third-party expert to automate data ingestion and oversee IT expenses instead. For organizations currently managing their IT spending in-house, the next step is to decide between a hybrid or fully external approach.
