The cost of staff at any professional business makes outages or chronic technology problems extremely expensive. This is an important and often overlooked component of your overall IT costs.

An excellent approach to controlling IT costs involves a periodic review of your technology. A small firm may need to do this annually, while larger firms should perform a review more frequently. A good IT partner will proactively schedule regular meetings with you to review your technology plan and costs. A few key items to consider:

• IT Support Labor (internal & consulting)
• Office Efficiency
• Hardware & software, including maintenance agreements
• Telecommunications (phone, internet, cell)
• Backup & Disaster Recovery

Labor expenses include both in-house resources as well as outsourced vendors. People by far represent the biggest expense. During your review, eliminate chronic problems by addressing root issues. Don’t waste labor cost repeatedly fixing the same issues.

Regardless of size, nearly all firms outsource at least some of their technology needs. There is an inflection point when a firm reaches about 50 or more people, where it typically makes sense to have at least one designated staff member working at least part-time on IT (backed-up by an IT consulting organization). It’s important to invest in training for in-house IT to keep skills fresh and reduce turnover.

Office efficiency is a key consideration as rapidly evolving technology can improve productivity and lower costs. During the review, it’s important to evaluate technologies with proven returns on investment. Changes in process, training, or possibly an application change may be beneficial.

Hardware is best managed on a proactive basis rather than reacting to failures. Software must be updated on a periodic basis, not necessarily for new features, but to ensure that critical applications remain supported. Diligent application of the latest security patches is essential to help protect against viruses and other malware. Reacting to hardware or software issues is much more expensive than proactively avoiding them.

Telecommunications is an area with new clients where I often find a huge opportunity to reduce costs and improve performance. I have clients where we’ve doubled network bandwidth and simultaneously cut costs more than in half.

Backup of business data is critical. Far too many firms think they have good backups, only to be unpleasantly surprised when files, databases, or e-mail need to be restored. Furthermore, your backup costs may be too high if you are relying on older, less reliable technology such as tape backups.

The most important thing is to have a checklist and a commitment to review it routinely. This leads to stable IT budgets, far less downtime, and fewer unpleasant surprises. Otherwise, it’s easy to keep doing things the same way you always have, and one day find that your costs and risks are out of control.