Does your IT deliver Value for Money? What does this mean? How can you prove it? Should you be taking a different approach? Where should improvements be made?
These are all very difficult questions to answer, so where do you begin?
Value for Money can mean and be viewed as different things by different people, whether it’s consumables, luxury goods or household items.
For example, a 150ml tube of toothpaste from a recognised brand costs £2, and in the same shop, a 100ml tube of the same product costs £1.75.
Which of these offers the greatest Value for Money?
Clearly based on a simple calculation, the larger tube gives you a cheaper unit cost (1.33p compared to 1.75p per ml) so this is the one that offers more product for your money.
But, and here’s the BIG but… If you are a frequent airline traveller and want to travel light, the smaller tube would offer you far more value for your money because you can carry it within your hand luggage.
In IT terms, it is just as complex, but what does “Value for Money” mean in terms of how your IT is delivered?
As a specialist advisory company, ImprovIT, defines that Value for Money is achieved where the charge for the IT services in scope is equal to or below the peer group and service quality is equal to or higher than the same peers.
Whether your IT is delivered in-house, outsourced, multi-sourced or other, you should regularly evaluate your IT to determine if it is delivering Value for Money to your organisation and if there is room for improvement. Perhaps you could be doing things better, cheaper and more efficiently.
What are your options for identifying these potential improvements?
I guess you could do some market research or even issue a tender, look in to all the various different options for IT delivery, review every company that provides
IT services and also has experience in your industry, compare them against each other and so on… That all sounds very time consuming, and it is! Especially if you don’t have the experience or a knowledgebase to start with.
Enlisting a third-party organisation to review your IT takes an immense amount of unnecessary strain off of you, enabling you to focus on your core business, whilst still being proactive in trying to reduce costs and improve services.
Benchmarking has long been the traditional approach to measuring “value” of the IT services. While it is a widely accepted approach, it can be time consuming, require significant effort and it can be seen to be relatively expensive.
Some have tried to counter the benchmark approach by conducting surveys, but the very nature of surveys makes the underlying data easy to critique and dispute, making them a somewhat discredited approach to calculating Value for Money.
In response to market demand, ImprovIT has used its market and benchmarking expertise to develop an optimised, faster version of its Value for Money service.
This newer, faster version is less invasive than a traditional benchmark and therefore requires less effort on the part of the client organisation. Using a newly evolved approach, ImprovIT can rapidly evaluate your existing IT services to determine the value it delivers.
This is achieved by comparing the IT services received by your organisation against the IT services of peers with similar scale and complexity, considering both costs and best practices and deliver a holistic, independent assessment of your current IT services, highlighting specific areas of both opportunity and current good practice.
At the heart of the newly optimised approach is a Market Test. It typically takes no more than 3-4 weeks to complete, is more cost-effective than a traditional benchmark and there is absolutely no compromise in quality.