Traditional approaches to cost optimization are still good hygiene, but today remaining competitive requires AI-driven cost transformation. We address three levels of cost optimization, identifying quick-win and deep-potential opportunities and working toward both simultaneously.
Think of traditional cost trimming methods as pushing down on a balloon - often, this causes another area to bulge because it's not addressing the big picture. This method involves a focus on cutting external spend, especially network, software and contract labor.
An intermediate method, cost substitution, involves operating model substitution usually through outsourcing, global capability centers, and/or AI and automation to drive sustainable cost resets.
The final method is a cost transformation of your business' operating model for agility, resulting in cost transparency. Using zero-based budgeting to stay goal-aligned, AI to accelerate the business, and change management to empower your people, you can continuously optimize costs to stay competitive.
ISG helps you achieve fast, sustainable savings through AI-centered expert advisory, market data and insights, and execution support.
We believe that you can't manage what you don't measure. The first step to achieving optimized costs is knowing where you are mis-aligned with the market and your goals. A rapid cost assessment enables you to understand short- and long-term opportunities and plan to go after them.
We perform a rapid, holistic market assessment of your IT and business functions looking for opportunities in four areas by asking:
Supplier Ecosystem
Can external spend be reduced?
AI and Automation
Can technology provide a better solution?
Processes & Controls:
Do you have the right visibility, transparency, decision support and controls?
Operating Model:
Can your operating model be improved to deliver better outcomes at a reduced cost?
We build a transformation roadmap prioritizing your cost optimization opportunities, a business case with an OpEx view, and a future-state operating model design.
We execute the transformation plan to realize phased savings, leveraging strengths in organizational change management, operating model design, sourcing and market data/research.
How do you know your project costs are reasonable? Are those costs being controlled appropriately? Previously, determining this was time consuming and difficult, and few had the expertise to truly answer the question. ISG makes project cost and effort estimation easy, and ensures no scope creep with rigorous controls and governance. Our unmatched data, sourcing experience and transformation expertise uniquely enables us to provide you with:
Saving shouldn’t compromise your growth. That's why ISG aligns cost optimization with your top-line business strategy, ensuring the program enables, and never hinders, your next move. We help you achieve sustainable savings that won't have cost bounce backs by integrating a cost optimization center of excellence into your company DNA. And our results speak for themselves:
Areas: Contract governance, telecom audit, software audit defense
Areas: Managed services sourcing, global capability centers (GCCs), automation
Areas: Software asset management (SAM), FinOps, technology business management (TBM), project estimation and controls, application rationalization
Transactional savings: 20% to 30% of specific external spend
Transactional up to intermediate savings: 10% to 35% of applicable external spend
Intermediate up to transformational savings: 20% to 50% of overall cost areas
Intermediate up to transformational savings: 15% to 30% of specific cost areas
ISG is a leader in proprietary research, advisory consulting and executive event services focused on market trends and disruptive technologies.
Get the insight and guidance you need to accelerate growth and create more value.
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