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Business Intelligence (BI) and Business Analytics are transforming the way today's companies operate and compete in the marketplace. IDC estimates that businesses will spend over $200 billion on these types of purchases alone between 2013 and 2016 - and vendors are chomping at the bit to make sure they get their share of the revenue.
With demand for BI solutions higher that ever before, CIOs must be vigilant about preventing overspending on these investments. Below are four ways that many businesses commonly overpay, often as much as 20% over fair market value:
1. Accepting annual cost increases.
Support, maintenance and subscription renewal costs are typically increased every year. Know your rates, as well as fair market rates, and challenge any increases that are not justified.
2. Paying too much for software.
BI and analytics are fairly new products for most organizations so they lack the knowledge to source and price them effectively. Vendors know this and often inflate the prices for these types of offerings. Do your research before investing in any new products or services, and avoid paying over market value.
3. Implementing big projects.
Implementing a new BI project is a huge undertaking that can be very complicated and expensive. While they are sometimes necessary, try to keep the big implementations to a minimum or reconfigure them on a smaller scale.
4. Paying too much for system enhancements.
As businesses change and grow, their BI and analytics functions will need to evolve as well to keep up. System upgrades and enhancements are crucial so you must be prepared to spend the money when necessary. Just make sure you avoid paying over market value by knowing what upgrades you need and when.
BI and analytics are powerful tools that can generate value and revenue when optimized. The best way to avoid paying too much for this technology over the next few years is to plan ahead and have a sound strategy in place.
With demand for BI solutions higher that ever before, CIOs must be vigilant about preventing overspending on these investments. Below are four ways that many businesses commonly overpay, often as much as 20% over fair market value:
1. Accepting annual cost increases.
Support, maintenance and subscription renewal costs are typically increased every year. Know your rates, as well as fair market rates, and challenge any increases that are not justified.
2. Paying too much for software.
BI and analytics are fairly new products for most organizations so they lack the knowledge to source and price them effectively. Vendors know this and often inflate the prices for these types of offerings. Do your research before investing in any new products or services, and avoid paying over market value.
3. Implementing big projects.
Implementing a new BI project is a huge undertaking that can be very complicated and expensive. While they are sometimes necessary, try to keep the big implementations to a minimum or reconfigure them on a smaller scale.
4. Paying too much for system enhancements.
As businesses change and grow, their BI and analytics functions will need to evolve as well to keep up. System upgrades and enhancements are crucial so you must be prepared to spend the money when necessary. Just make sure you avoid paying over market value by knowing what upgrades you need and when.
BI and analytics are powerful tools that can generate value and revenue when optimized. The best way to avoid paying too much for this technology over the next few years is to plan ahead and have a sound strategy in place.
About the Author:
Joseph B. Kappernick specializes in assting enterpres reduce operating expense. He suggests that you visit http://www.npifinancial.com to learn more about telecom cost management
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