How to Cut Costs with the Help of Technology?

By: Editor
May 20, 2009

Page: 1/2


This article gives you an insight into the various means of cutting cost / saving cost with the help of technology.

  • The Tech Mantra for Cost Cutting…
  • A Solution to the Economic Problems of Companies…
  • Choose The One That Works The Best For Your Organization…
  • Higher ROI’s are not impossible to achieve…

It is often said that cutting costs never made any one a millionaire. Though it can be true but, in the backdrop of economic uncertainty, this is the only option left for survival. The question of cost cutting is probably the most common question in the corporate circles. So here are some technologies related tips for cost cutting.

Software-as-a-Service (SaaS)

SaaS is a model of software deployment in which a vendor provides software to customers for use as a service on demand. SaaS application delivery models first emerged in the late 90’s and the rest is history! Further SaaS software vendors may host the application on their own web servers or download the application to the consumer device, disabling it after use or after the on-demand contract expires. Hence it enables a company to use only specific features of any kind of software, without the need to install update or maintain it. This paves the way for greater flexibility and cost savings for an organization. Examples of SaaS vendors include Microsoft, SAP Business by Design and Google Apps which provide common business applications online that are accessed from a web browser, while the software and data are stored on the servers.

Enterprise Resource Planning (ERP)

This is the second cost saving tech tip. Enterprise Resource Planning (ERP) is a broad term for any software application that integrates (or tries to integrate) all the processes and data into a single unified system. So it brings all the data of an organization on one common platform. The benefits of implementing ERP are as follows:

  • The biggest advantage is speed because the employees get immediate access to information they need to operate on a daily basis. For instance it will be easier for the packaging department to meet deadlines effectively, if they have access to the information regarding the number of units being ordered and manufactured.

  • The second benefit is the reduction in risks and confusion. The organization functions with greater clarity with all departments have access to the needed information.

  • Higher return on investment (ROI) is yet another key benefit.

  • Increases flexibility.

  • And of course reduction in costs as a result of all the above benefits.

Well, if you are wondering about the cost and time needed for implementing ERP, you needn’t worry. Yes that’s true that earlier ERP’s carried seven-figure price tags and required two-year deployments, not to mention battalions of expensive IT consultants to keep them up and running, today the scenario has changed. The ERP’s these days can be deployed in a few weeks and have meager chances of crashing. And finally, the overall cost of ERP services has dropped 40 percent over the past five years, estimates Forrester Research analyst Ray Wang.

Microsoft (Charts), SAP (Charts), and Sage Software are among the leading small-business ERP providers today. Each has a different strength and weakness depending upon the need of the enterprise or business owner. On the one hand Microsoft provides strong analytic tools but on the other is believed to impose hidden costs. Similarly, SAP delivers comprehensive ERP out of the box but can limit user flexibility. So why not try an ERP suiting your business needs and save those extra dollars?

Appliance Based Software Delivery

This new model of software delivery offers many of the same benefits as SaaS models and a few additional benefits that create an advantage for certain types of applications. Application Based Software Delivery (AbSD) is a combination of hardware and software that is pre-installed and pre-tuned and is directly plugged into a network, removing the need for any hardware or software configuration. Similar to SaaS, AbSD also has the following advantages:

  • Web-based interface

  • Ease of installation and configuration

  • Automatic application data feeds, maintenance, and upgrades

  • Automatic data recovery and backup

But, one of the biggest advantages which AbSD has to offer besides cost reduction is security and reliability. So, it makes sure that the organization is in possession of its own data.

Open Source Software (OSS)

Open source software (OSS) are computer software for which the source code and certain other rights which are normally reserved for copyright holders are provided under a software license which meets the Open Source Definition. This permits the users to use, change, and improve the software, and to finally redistribute the same in its modified or unmodified forms. Hence usage of open source software allows the company flexibility to put in their own code, thereby allowing them to customize the software and intern save huge costs. It is estimated that adoption of open source software models has resulted in a savings of about $60 billion per year to its consumers. Some of the more prominent organizations involved in OSS development include the Apache Software Foundation, creators of the Apache web server; a loose affiliation of developers headed by Linus Torvalds, creators of the Linux operating system kernel; the Eclipse Foundation, home of the Eclipse software development platform; the Debian Project, creators of the influential Debian GNU/Linux distribution; and the Mozilla Foundation, home of the Firefox web browser.

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