Vendor consolidation a hot-button topic for CIOs as they try to manage the tensions between innovation and efficiency

Mar 08, 20235 mins

CIOs have always had to find a balance between the need to deliver innovation and the need to establish operational excellence. However, this tension has become even more challenging in recent years.

After several years in which businesses of all sizes and across all sectors were forced to transform rapidly in response to the pandemic, CIOs are now facing the need to drive optimisation and re-focus on the stability of the IT environment. According to The Human-Centered Insights To Fuel IT’s Vision 2022 report, conducted by Reach3 for Lenovo, 83 per cent of CIOs are still seeking digital transformation, but 76 per cent also acknowledge that they’re grappling with the challenge of finding the right balance between business innovation and operational excellence.

In a report, EY highlighted five steps towards delivering innovation in a way that also achieves cost efficiency. These steps are:

  1. Leadership and Culture – where embracing the entrepreneurial mindset across IT motivates individuals and brings transformation initiatives to fruition.
  2. Technology Transformation – particularly, however, the CIO needs to understand what technologies to invest in that maximise a company’s value.
  3. New Methodologies – Agile methodology is more needed than ever, so organisations can experiment, measure outcomes, and learn fast.
  4. Governance and Ownership – striking the right balance between retaining the right level of control while also allowing the Agile approach to thrive is critical.
  5. Sourcing and Partnerships – revisiting and improving the sourcing strategy is critical for minimising the total cost of ownership while maximising the value of the investment.

One of the key steps in achieving all of the above will be vendor consolidation, and there will be a strong trend towards this in the year ahead. For example, one key piece of advice for CIOs looking at constrained budgets and inflationary pressures in the year ahead is to be open with suppliers regarding those budget constraints. Having a true partnership with an end-to-end supplier allows the CIO to more strategically engage and drive both optimisation and efficiency across the IT environment. A full 21 per cent of CIOs say that a major focus of theirs is negotiating with IT vendors. Reducing the number of vendors helps to minimise this disruption.

What does the right technology partner look like?

According to the Lenovo and Reach3 report, there are three qualities to an end-to-end solutions provider that will help to drive successful optimisation and consolidation across the organisation:

  1. Productivity and Collaboration

At a top level, one of the key benefits of consolidating the number of vendors to a single end-to-end provider is that the technology is inherently designed to work well together. This helps improve reliability, and reduce the amount of time that the IT team spends on managing technology. In addition, it improves the security of the IT environment by limiting any gaps in the connectedness between technology.

One in four CIOs spend a significant amount of time managing IT crises. In addition, 51 per cent and 43 per cent have security management and improving IT operations as key priorities. The wastage that comes from poorly structured IT environments can consume far too much timefor the IT team. Vendor consolidation provides a way to quickly start to address this challenge.

2. Agility and Optimisation

Just as the modern business needs to operate according to agile best practices, CIOs have to find suppliers that can scale quickly as the business needs. This ranges from the technology and devices needed to access work, through to their service and support and end-of-life management.

To address this need, Lenovo created the TruScale Infrastructure-as-a-Service solution, which offers day-to-day support, flexibility backed by a pay-as-you-go model, and complete transparency into the whole environment at all times. This solution allows CIOs to shift most of the IT environment to an OpEx expenditure model while working with Lenovo to deliver a solution that is tailored to the specific needs and objectives of the organisation.

Meanwhile, at the device level, Lenovo provides technology that has been designed to meet all needs and require minimal customisation and support. The ThinkPad X1 Carbon, powered by Intel vPro®, An Intel® Evo™ design, for example, is built for what IT needs and users want. Backed by Lenovo accessories, the CIO can streamline their device fleet rollouts and management by working with a single provider.

3. Intelligent Infrastructure

With the ongoing migration to the cloud, organisations are realising significant improvements to the efficiency and productivity of their working environment. Having IT solutions that are structured around cloud computing as the default is essential. The bulk of corporate data is now stored in the cloud, and workplaces have become completely decentralised, flexible and hybrid in nature, so flexibility in infrastructure is critical.

CIOs realise the value of finding the right vendor partner. Lenovo research shows that 92 per cent of CIOs believe that their vendors play a valuable role in their company’s overall success. However, having too many vendors can result in incompatibilities, confusion, and time lost in vendor management. For CIOs that are looking to deliver an agenda that both supports innovation while realising efficiencies, finding the right partner for an end-to-end technology solution is going to be a priority.

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