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Management: Time to Stop Wasting 60 – 70 Percent of Operations Budgets

Luis Praxmarer

Luis PraxmarerThe typical IT operations shop wastes up to 70 percent of its budget every year. In fact, IT operations can increase its delivered capacity by 2x and simultaneously cut overall costs by 50 percent while shrinking power consumption by 80 percent if they so desired. The reason is that IT typically operates using a flawed, outdated business model that needs to be replaced with the more modern cloud-style business model. The good news for IT executives is that the switchover can be self-funded for those willing to take the steps necessary to improve data center operational efficiency, and potentially, preserve their very jobs.

Enterprises that do not convert to the new cloud business model will find they are not competitive and that line of business and/or development executives will stop utilizing internal IT operations for delivery of their offerings. IT executives should perform an audit and baseline analysis so that they can begin to clean up their operations with quick hits and a long-term strategy and plans to transform the organization. Furthermore, IT executives should build the business case (preferably self-funding) and gain buy-in from development and line of business executives. Lastly, IT executives will need to measure, monitor and report on progress on an ongoing basis – effective communications is necessary to keep the users loyal and working with the organization and not against it.

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