A Sound Decision in IT Connectivity Cost Reduction

One of the fundamental jobs of the IT department of any business is to regulate the availability of online resources for the business staff.  Often one of the most neglected elements of business is the speed of those available resources.  When the CFO looks for areas to reduce costs in the IT department one of the costs they look at is the cost of internet. Make the wrong decision here and the cost to your business can be fatal to the bottom line.  The question that leads to the sound decision: Is slow internet costing your business?

– No one counts the seconds between page loads –

If your business has multiple connections, with many offices calculating the cost to your business can be a difficult task.  The first element of calculating this cost to your business is to task your IT team with calculating the total amount of downloaded content during a month time frame at each location.  This task becomes ever more important in business as most office related tasks move online. Use of cloud systems require high bandwidth and can put unknown strain on your business. Have you recently moved your phones to VOIP? VOIP can add a constant strain to your network that most be accounted for during this investigative period.  Additionally, older network equipment can be holding back the bandwidth you do have available.

Lets assume after your IT team has surveyed the company they determine that the network could be faster.  How do we illustrate that cost of a network bottleneck to the executive team?

Below is a calculation to illustrate the current cost of the issue per day impacting your business without including any system outage experienced by users.  Network cycle time on bottlenecked networks will range from 3 minutes to 6 minutes in a worst case scenarios when connectivity is not performing at peak performance.

Lets look at the algorithm

CostPerDayLoss = ((CurrentNumberOfEmployeesExperiencingIssues[ex 50 users] * AverageEmployeeSalaray[ex $20])/ 60 Minutes)* NetworkCycleTimePerHour[3 Mins] * EfficientEmployWorkHoursPerDay[~6hrs]

Example:

Number of employees working on a network experiencing bottlenecks: 50
Average productive work hours per 8-hour day: 6 Hours
Average salary per employee: $20.00 per Hour
Network Cycle Time (This is the amount of time it takes a taxed network per hour to resend packets to other machines.): 3 minutes Per Hour

Cost Per Day: -$3000.00

cost of network inefficiency - sounddecisions.co

A recent examination of a medical billing business revealed that their decision to save 60 dollars a month increased their costs by over 60,000 a month in employee efficiency.

The right decision to make in this situation is to increase the speed.  You can drive more efficiency in your business and further reduce costs to your organization by making the most critical aspects of your business more widely available to your staff.  If each website or resource is sped up by just 3 seconds you could be saving your business upwards of 60,000 a month by increasing the investment in your connectivity. You owe it to yourself to find out if slow internet killing your business.

So how do we go about saving money and making the sound decision

Working directly with carriers is like paying sticker price for a car.  You see the pricing that every client gets, and the people you work with at the other end are paid to get the most money out of you as humanly possible.  If your business has multiple locations and multiple providers this negotiation process can be long and costly and could hold you back from gaining your best deal.

What is the alternative?

If your business has a single connection or multiple connections the recommended course of action is to hire an advocate. The sound decision here comes through aggregation and representation. We’re not talking about a lawyer here, we’re talking about a connectivity broker.  Connectivity brokers have unique relationships with the providers and are well versed in the pricing of the different providers.

The brokers simplify all support requests  and get direct resolution on issues faster than you can.  Each broker represents hundreds of clients for many providers, their access to support is addressed with the highest priority by the providers.  With a broker your business can aggregate a number of services.  VOIP, data center services, backup connections, managed service and a host of other IT related services.  Once you work with a broker your executive team can negotiate the best deal possible.

 

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