Gagan Goraya

7) Review and Renegotiate telecommunication contracts

It is a good time to renegotiate IT and Telecom contracts. There is a lot of competition and number of viable options exists, at least in the major business centers. Before you start negotiation process, make sure you take a complete inventory of network and data lines across your organization. You might find that there are some unused lines or connections, or there might be redundant capacity at certain locations. Perform an audit to make sure you are not getting a duplicate billing from multiple telecom providers. At a recent audit we discovered duplicate charges involving two major Telecom providers. As a result of the audit, company ended up receiving a credit for $51K. Try to consolidate as many lines with one or two main telecom providers. This will cut down admin time to manage and support your network. With luck the review process should entail in significant savings. There are companies that can provide this service if you feel overwhelmed by the entire review process. Some companies guarantee savings without any out of pocket expenses.

The renegotiation process is a little more involved and requires that you do your homework before you call a service provider. Most critical task is to understand exactly what you need to get out of the product or service before entering into the negotiation. An ability to prove price disparity makes your position strong.

If you plan to renegotiate keep in mind that best deals command:

- Good relationships with vendors can help you achieve your goals.
- Best deals often come from the incumbent carrier or service provider.
- Arrogant tactics may work providing you are a large account and you have multiple choices.
- Emphasize on ongoing growth and future potential.
- You still require quality service even though you are getting a better price

There are some value-added services that are worth paying a little.

- Network architecture evaluations and recommendations.
- Technology planning.
- Various consulting and training services.
- Reduced maintenance and support costs.
- Extended warranties.

8) Virtualization – Let’s Go Virtual

There is a lot of talk about virtual servers so you may be familiar with the term. For those you are unfamiliar with this, let me give you a quick introduction. Over the years, technology has been consistently improving and the cost of hardware has been coming down at the same time. The result is that we have more powerful computers that are capable of handling multiple applications.

A virtual machine lets you share the resources of a single physical computer across multiple virtual machines for maximum efficiency. A virtual machine behaves exactly like a physical machine except it is sharing the hardware platform with one or more virtual machines. Although there are many benefits for doing this; the most significant benefit is lower cost of ownership. Imagine that you have a powerful computer that is hosting many small virtual servers. As a result, your hardware maintenance costs go down significantly. You will have fewer servers in the computer room. This will result in less power consumption as well as lower cooling costs. It is a good way to consolidate servers.

Other soft benefits of “going virtual” are that there are fewer components that can fail allowing your IT department to focus on other areas. Your servers will be fully utilized and the backup and recovery process is a lot simpler. In almost all cases, there are significant savings when and if you decide to use virtualization. Many major corporations are now solely depending on virtual servers due to significantly reduced recovery time. Transportation companies can definitely benefit for this.

9) Implement E-faxing

Although most companies are now using emails to do majority of their day-to-day transactions, we still haven’t let go of that old fax machine. We are still generating paper, ordering toners, and paying telephone companies so we can receive bunch of junk flyers every morning. As far as I can see this is a total waste of money and poor use of company resources. I can see that you still need one fax machine in the office to use in case internet is down but, it cannot be your main form of communication. You may ask what the alternative is. Well, there are some good e-fax solutions out there. They are simple and easy to use. Basically, you get a monthly subscription that allows you receive all your faxes to an email. You can choose a local number or a toll free number. The service allows you to send faxes straight from your email. A small office that sends or receives a few pages, the subscription usually costs less than what you pay monthly for a fax line.

Alternatively, you can setup your own fax server. A word of caution, unless you have in-house IT staff, I don’t think you want to setup and manage your own fax server. Fax servers require routine maintenance. For smaller locations, it is usually cheaper to deal with an external company. This initiative can save you a lot of money. Also keep in mind that most of these e-fax solutions will save you long distance charges on send and receive.

10) Slash your cellular budget

It is very crucial to maintain control over the cellular costs. A regular audit of the cell phone usage within the company is a first step in establishing control. As a service, most mobile service providers offer this as a part of the package. However having an independent audit is a must in order to ensure that you are getting the "best bang for your buck". An audit can confirm your usage pattern as well as how well you are utilizing your cellular plan. Even if you have minute pooling option on your account, you can make minor adjustments which can lead you to major saving. Often there are hidden fees built into your plan which may go unnoticed.

There was an article in a technology journal criticizing the notion of giving company phones to individuals within an organization. I guess the argument can be made for either case, whether you are a proponent of having company phones or not. One thing is clear though; a lot of us own personal cell phones or have access to one at all times. So is there a happy medium? I believe there is. I believe companies should have two tier cellular phone policy; one for the sales and operations group, that requires a cell phone all the time. For this group a cell phone is a lifeline and it is perfectly justifiable to have company phone. However, for the second category that doesn’t require a cell phone at all times, we should consider the reimbursement option. The reimbursement option gives individual to choose their own phone, type of plan, and personalized contract. Companies can reimburse all or portion of the expenses while staying out of long term cellular contracts. The best part is that individuals will monitor their own usage rather than company. It will cut abuse and unnecessary expenses.

For organization that have number of cell phones and large cellular expenses. I urge you to look closely into your cellular bills. You will save money by consolidating your plans and by instituting cellular use policies.

Closing remarks:

I would like to thank everyone for reading this blog. Cost reduction is one of my favourite topics. I do welcome your feedback and appreciate all comments so, please keep them coming. These topics are fairly broad however, I would respond to your emails where you can ask more specific questions. Moving forward, I will be focusing on individual I.T. related topics.

Gagan Goraya

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