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. Not challenging annual cost increases.
Vendors will often increase prices for support and maintenance every year, without justification. Be aware of any increases and dispute any that cannot be rationally explained.
2. Paying too much for software.
BI purchasing is an area in which many organizations lack experience and knowledge. Because of this, they often pay above market value, which in turn leads to inflated vendor pricing. Make sure to compare prices from different vendors and educate yourself on these products.
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. Overpaying for solution upgrades and enhancements.
BI and analytics will need to be upgraded and enhanced as your business grows and evolves. Prepare to increase your budget for this area of IT and commit your organization to providing the resources it needs to be successful.
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. Not challenging annual cost increases.
Vendors will often increase prices for support and maintenance every year, without justification. Be aware of any increases and dispute any that cannot be rationally explained.
2. Paying too much for software.
BI purchasing is an area in which many organizations lack experience and knowledge. Because of this, they often pay above market value, which in turn leads to inflated vendor pricing. Make sure to compare prices from different vendors and educate yourself on these products.
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. Overpaying for solution upgrades and enhancements.
BI and analytics will need to be upgraded and enhanced as your business grows and evolves. Prepare to increase your budget for this area of IT and commit your organization to providing the resources it needs to be successful.
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 recommends that you visit http://www.npifinancial.com to learn more about telecom cost management
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