The past five years have been a whirlwind of change, with unprecedented disruption, turbulent global financial markets, and geopolitical and social upheaval. This volatility has upended carefully crafted tech strategies, budgets, and priorities, leaving technology leaders feeling unsure and overwhelmed. For many, this is a familiar feeling, as we have been down this same path over these past few years. Many leaders and individual contributors alike are running on empty. As much as we want to regain control, lead people through difficult times, and navigate the ongoing chaos gracefully, it can feel like an insurmountable goal in the current reality.
To lead through this change, the best approach is to keep it simple and tangible. Focus on clarifying the unclear, celebrating successes, managing risk, and giving employees the space to innovate and take ownership to drive a better path forward.
At the same time, tech leaders won’t have a choice — we will need to do more with even less. This will mean dusting off the cost-cutting playbook from prior years to seek out additional optimization opportunities but without sacrificing your AI ambitions. What are a few cost-cutting measures to focus on?
Assess and rationalize your portfolio (duh!). We know this one well — and also know that it is easier said than done. Eliminating redundancy is crucial as sprawling portfolios drain budgets and increase security risks. Focus on consolidating contracts, standardizing across business units, and eliminating redundant capabilities. You’ll need a way to prioritize your cuts; lean on your IT financial management practice if you’ve got one. Remember, these cuts aren’t just about freeing up the cash you need, but more importantly, this effort also creates a tighter, cleaner tech stack that enhances data consistency, security, and AI readiness. Quick wins include reclaiming software-as-a-service licenses, sunsetting underutilized software, and removing operational overhead for end-of-life technology.
Eliminate cloud waste and seek out discounts. Often hidden within cloud bills is waste, and for those who haven’t formally addressed this, this waste can typically be 30% of the total bill. Use native cloud cost management tools (practically free) or third-party platforms to identify unused, untagged, and poorly fitted instances, potentially yielding significant savings. For larger enterprises, negotiating discounts with hyperscalers can also provide substantial cost reductions. For some organizations, virtualization sprawl or mainframe prioritization can also fend off new purchases by freeing up existing resources for new use.
Examine abstraction layers. While virtualization improved IT cost efficiencies, today’s multiple layers, such as hypervisors, app servers, and containers, can create redundancies and high costs. Simplifying these layers can enhance performance and security as well as reduce license costs. Consider managed public cloud services for container runtimes and explore alternative Kubernetes paths and cost-effective open-source options.
We include a longer list of options in our report, Technology Leaders: How To Thrive Through Volatility, while digging into enterprise risk management and change leadership to help you navigate these difficult times — again. We will also be hosting a webinar for clients, Leading Through Volatility: Technology Expert Panel, on April 29 at 11 a.m. ET. Join us live or watch it on demand later.
Lastly, a few reminders for managing through volatility: Do not abandon long-term, North Star strategies already in place or in development. This will not only hurt your organization but your long-term ability to lead, as your best talent wants to be part of progressing toward a better end state, and when that vision is put aside in times of strife, you risk losing their presence and sliding backwards from any cultural gains when it comes to embedding continuous improvement and curiosity. Your employees will not be quick to forget this and will be less ready to follow you in sunnier times or into the next battle. Without your best talent playing a key part in taking major cultural strides, it will be near impossible to drive the long-term success and transformation needed for your organization.
If you want to discuss the report or ways to respond to circumstances specific to your organization, please reach out to schedule an inquiry.
