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.
IT vendors will be eager to cash in on their share of these billions, so it is no surprise that many organizations are at risk for overpaying as much as 20 percent on these products. Double check these four areas to make sure you are getting the best prices:
1. Not challenging annual cost increases.
If you never question yearly rate increases, vendors many take advantage and raise prices at an unreasonable rate. You should always dispute any rate increases that you don't understand or find to be fair.
2. Overpaying for software.
Software licenses are frequently priced well above fair market value by most vendors. But, companies continue to pay these inflated prices because they are inexperienced in BI purchasing and sourcing. Always compare prices and know the market value of all IT purchases before you buy.
3. Large project implementation.
More and more, BI projects are becoming larger, more complex and more expensive. Implementing a big BI project may end up causing more harm than good if you are unable to manage it efficiently. Keep projects smaller and more manageable to save on unnecessary costs.
4. Overpaying for ongoing upgrades.
For BI and analytics to work effectively and generate value for your business, they must be continuously upgraded and customized to suit your ever-changing needs. Be ready to raise your budget allowances for any necessary system enhancements, but also know what products you can do without to save money.
When used properly, BI and analytics are invaluable tools that will grow your business. They can also cause much confusion and wasteful spending if you are unprepared for this type of commitment. Avoid any headaches and financial catastrophes by planning ahead with a sound pricing strategy and clear objectives.
IT vendors will be eager to cash in on their share of these billions, so it is no surprise that many organizations are at risk for overpaying as much as 20 percent on these products. Double check these four areas to make sure you are getting the best prices:
1. Not challenging annual cost increases.
If you never question yearly rate increases, vendors many take advantage and raise prices at an unreasonable rate. You should always dispute any rate increases that you don't understand or find to be fair.
2. Overpaying for software.
Software licenses are frequently priced well above fair market value by most vendors. But, companies continue to pay these inflated prices because they are inexperienced in BI purchasing and sourcing. Always compare prices and know the market value of all IT purchases before you buy.
3. Large project implementation.
More and more, BI projects are becoming larger, more complex and more expensive. Implementing a big BI project may end up causing more harm than good if you are unable to manage it efficiently. Keep projects smaller and more manageable to save on unnecessary costs.
4. Overpaying for ongoing upgrades.
For BI and analytics to work effectively and generate value for your business, they must be continuously upgraded and customized to suit your ever-changing needs. Be ready to raise your budget allowances for any necessary system enhancements, but also know what products you can do without to save money.
When used properly, BI and analytics are invaluable tools that will grow your business. They can also cause much confusion and wasteful spending if you are unprepared for this type of commitment. Avoid any headaches and financial catastrophes by planning ahead with a sound pricing strategy and clear objectives.
About the Author:
Joseph B. Kappernick specializes in helping Fortune 500 companies save money. He recommends that you visit NPI to learn more about IT cost reduction service
