CIO Perspective Series: How to Free Up Funds for Innovation

Learn three effective strategies to free up funds for innovation and avoid spending too much on your current business and not enough on the future.

The shift to digital business, fueled in part by remote and hybrid work, has created a greater sense of urgency around the need for innovation. Finding the resources for innovation, however, is an all-too common challenge. Take, for example, the findings in our 2022 IT Priorities Report, our recent Snow survey of 200 IT practitioners from the U.S. and the U.K. In this survey, 94% of U.K. and 89% of U.S. IT practitioners agree that innovation is one of their key objectives but creating a culture that supports it may be standing in their way. Additionally, more than half of respondents (70% in the U.K. and 53% in the U.S.) believe their IT departments spend too much time reacting to problems, reducing the opportunity to innovate. How can IT practitioners free up funds for innovation if they spend too much energy and attention on reacting to daily business issues? 

In my below conversation with Snow CIO Alastair (Al) Pooley, we talked about IT budgets and the strategies business leaders can use to free up funds for innovation.

Strategies to free up funds for innovation

Budget allocation for “keeping the lights on,” as Al explains, very often outweighs spend on innovation. This happens even though the need for innovation and digital transformation is one of today’s highest priorities for IT practitioners. 

To optimize spend and free up funds for innovation, he recommends three strategic cost-saving strategies.

1.    Shore up software licenses 

As much as 30% of spend on software and cloud services is wasted. Many licenses sit idle, rolling from one renewal to the next via unused accounts, duplicate users and redundant applications. This waste drives up cost and results in a more time-consuming process for IT as they prepare for vendor negotiations. 

Comprehensive visibility into your software usage will help you reduce waste by identifying unused accounts and duplicate users. You can also eliminate unnecessary premium subscriptions and redundant and/or unused applications. 

2.    Consolidate software use

Cost also goes up as individual business units increasingly handle technology spend instead of IT. To counter the trend, IT must secure an ITAM tool with the ability to see across all business units. After that, IT can right-size the entire technology estate by consolidating software to avoid duplication, sharing licenses where appropriate and creating one enterprise-wide service agreement with much more cost-effective terms. 

Al references the excellent example of Snow customer Panasonic Information Systems Company Europe, an IT provider for the Panasonic Europe Group. Their distributed purchasing structure left many assets unseen and resulted in very high fees during audit time. Snow helped Panasonic consolidate software use for their 12,000-person user base. With that help, they optimized license types and quantity and significantly improved audit readiness and vendor contract renewals. 

3.    Automate

Servicing users is another area in which IT can reduce costs and free up funds for innovation. Take, for example, provisioning new resources and managing a hybrid cloud infrastructure. They can be complex and time-consuming. Fortunately, IT can eliminate slow and costly manual processes by providing users with a quick, automated self-service portal for provisioning.  

For another great example, Al mentions Serena Software, a global application lifecycle management solution provider. Serena turned to Snow to set streamline the automation and provisioning of systems its developers used. In addition to improving their productivity, controlling costs and providing a highly responsive user experience, they were also able to have more informed budget conversations with business units.

Concluding thoughts

Attempting to free up funds for innovation is always challenging. Fortunately, as Al says in the video, there are ways to maximize your budget in ways that free up funds for innovation. By doing so, you’ll drive business-wide agility, improve efficiency and ultimately change your organization’s culture. 

Are you interested in more insights from our 2022 IT Priorities Report? You can download it here.

Have you seen our previous CIO Perspective posts on how to start an ITAM practice and technology visibility? You can also check out our next installment on maximizing your cloud investments with FinOps.