Why thinking of your IT department as a cost center is a costly mistake


September 18, 2018

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Asking a CEO or executive to pick a favorite department is sort of like asking a parent to pick a favorite child—if you really care about your staff’s welfare, you just don’t do it. However, the truth is that the IT department has long been viewed as something of a company black sheep. Tasked with ongoing maintenance and other routine tasks, this department represents a costly drain on budgets and resources. Or does it?

One thing’s for sure: Shifts in technology are changing the role of IT departments and managed service providers (MSPs). Cloud storage options, hybrid servers, security solutions and automation have added to the complexity of the role, moving IT departments to the realm of strategic positioning. Simply put, IT departments and providers now drive innovation and eliminate budgetary waste, rather than the other way around. Here are a few reasons why you might want to rethink your view of the IT department.

Technology streamlines employee productivity

Many technologies that improve efficiency and strategically position you for new innovations may not be directly tied to profits. Although productivity gains are more difficult to measure, that doesn’t make them any less important.

For instance, mobile networks and virtualization increase your ability to collaborate across separate locations as you grow. These tools also allow you to leverage talent wherever candidates happen to be, rather than relocating employees to your offices. Many studies have tied mobility to productivity—for instance, Forbes reported that mobility leads to better processes and a 23% increase in productivity—and these gains simply wouldn’t be possible without IT teams.

Mobility is not the only aspect of doing business in which IT solutions providers can improve day-to-day efficiency. Indeed, IT tools allow developers to create test environments for new releases and websites, and IT teams—particularly MSPs—interface with external vendors to ease the administrative burden on account and project managers. Perhaps most importantly, IT solutions providers can point out areas where a few technological investments can save time, cut costs and help you keep up with your competitors.

IT drives innovation

In today’s world, digitization is virtually synonymous with progress and growth. But although balancing technological investments against profit is an important part of the decision to implement new tools and infrastructure, the members of your executive team are making a mistake if they focus on the bottom line alone.

After all, your IT department can do a lot more than fix a broken printer. Over the years, the role of “the IT guy” and the MSP has progressed from that of a lowly repairman to an incubator of digital innovation. Nowadays, IT solutions providers work closely with developers to build new solutions that harness digital markets and streamline workflows. They weigh in on the executive team’s digital roadmap, help businesses plot their priorities, and schedule migrations and implementations, among other duties.

Take, for instance, this article penned by UPS CIO Juan Perez. In the piece, Perez describes how IT teams played a pivotal role in integrating new technology at UPS by implementing new handheld digital devices—and the mobile networks that served them—to streamline package delivery for drivers. Along similar lines, the U.S. military made waves in 2006 with Sgt. Star, a recruiting “chatbot” capable of doing the work of 55 human recruiters. The good news? Since these examples hit the headlines, the technology behind them has become fairly commonplace.

In short, IT is pivotal to modern innovation—and it appears most executives now recognize this, as a Gartner survey of 460 CEOs found that IT came in third among executives’ top priorities, after growth and structural development. It’s safe to say that the perception of the IT guy as a glorified repairman is simply outdated.

The right IT investments actually eliminate costs

If you plan wisely, implementing IT solutions can actually shave off money from technology budgets. The cloud is a great example of this, as moving data storage to external databases has allowed businesses to make significant cuts to infrastructure investments while enjoying cheaper access to cutting-edge technology. In fact, the Brookings Institute estimated that businesses can see between 25% and 50% savings by moving to the cloud.

Looking to the future, investments in machine learning and AI may save businesses even more, as automation eliminates redundancy and streamlines tasks. Calling back to the Sgt. Star example, a chatbot can help you move candidates through the recruitment process, thereby improving HR efficiency. Moreover, big data can provide analytics that will drive sales and improve marketing and advertising accuracy, while automation and machine learning will enhance industrial processes and improve mobility. We’re verging on the precipice of another industrial revolution, one in which more advanced devices and communication will massively improve productivity—and cut costs right along with it.

But none of these advancements will be possible without strong IT infrastructure, technological expertise and planned rollouts. Of course, it can be difficult to assemble an internal IT department that will be up to these tasks, and that’s where MSPs come in. Today’s MSPs have broadened their offerings to include strategic planning and development, allowing you to implement new technologies as they become available.

Interested in learning how MyITpros can get you from here to there? Contact us today for a free consultation and you’ll start reaping the benefits of a fully utilized IT department before you know it.

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