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How Can ITIL 4 Help Enterprises Reduce Costs?

February 16, 2021 | ITIL
Read Time: 04:00

Incorporating an ITIL framework into the business isn’t easy, but it is proved to drive huge cost savings. Let’s learn how ITIL 4 cost reduction strategies can help your business.

Gartner’s vice president, Jay Pultz, stated that IT infrastructure and Operations (I&O) represent 60% of the total IT spending worldwide and if businesses implement 10 key actions, I&O cost savings of 10% in 12 months and up to 25% in 3 years can be achieved. One of those actions is the implementation of ITIL best practices. I&O accounts for 50% (approx.) of the total enterprise IT headcount, wherein most of the staff is involved in daily and operational processes. Implementing ITIL as a part of streamlining these processes, to improve service management and quality has been known to reduce costs.
Even though most of the CIOs agree that adopting an ITIL framework is good for the business, getting the organization to agree – both psychologically and monetarily – fully adopt the framework as well as rework the business policies & procedures is not an easy sell to the upper management. Read on to find out how ITIL processes can be leveraged to reduce costs by improving efficiencies and utilization.
Service Level Agreements (SLAs): There are instances where businesses do not receive the services at the full capacity to which they have subscribed under their SLA. For instance, not getting internet access at the guaranteed speed, or vendors with on-site support agreements not meeting their time windows, etc. Spotting and fixing these instances can bring refunds back into your company’s bank account, however, these details are often hard to track or get neglected. ITIL techniques make these reviews easier, both initially and on an ongoing basis.
Right-sizing Services: Any business analyst with an ITIL 4 certification has a clearer and more precise picture of which services are appropriate for their company’s needs and which aren’t contributing towards its cost-efficiency. Sometimes less-expensive solutions are more viable, while sometimes a combination of multiple services can work wonders into reducing the costs.
Network Links: Your organization might have many over-specified or under-specified network links. If you have a team with the ITIL 4 online training, not only can you save costs by cutting back on unutilized services, but you can also have a clearer view of the networks that are oversaturated with data and thus, prone to downtime.
Cost Avoidance: Avoiding useless expenses is better than saving money. With ITIL cost reduction strategies, you can get a complete inventory of all the tech assets, configurations, user base, intended purpose, and user profile. With that you can determine the assets you don’t need at all and the types of assets that you need or could use maintenance contracts for.
Redeploying Existing Assets: You can save hundreds of thousands of rupees by making sure your existing hardware and software are working and properly utilized. With ITIL practices, you can get a comprehensive picture of all your IT assets and see which resources are properly distributed, if there are any underused computers or any routers that can be switched. ITIL 4 framework will facilitate reviews of deployment strategies.
Consolidation & Vendor Management: As mentioned above, ITIL facilitates thorough reviews of vendors and their services. With these, you can determine which service providers or vendors offer a variety. You can consolidate services under one provider, negotiate for volume discounts, get better services and flexible payment terms, increase your SLA commitments – which all ultimately contribute to cost-saving for the business.



You can see that though ITIL’s financial management process framework reduces operational IT costs, other ITIL practices such as capacity management, configuration management, and problem management also play an important role in cost optimization.
Final Analysis – Why Leverage ITIL 4 for Cost Savings?

  • Configuration Management Plan (CMP) helps reduce change costs.
  • Service testing and validation reduce service request costs.
  • Service Asset and Configuration Management (SACM) helps reduce multi-tier escalation costs of nonstandard configurations, drive standard configurations for service assets.
  • Proactive integrated incident and event management processes reduce incident and outage costs.
  • Fulfillment request process costs are reduced.
  • The problem management process reduces recurring incident costs.


Streamline business operations – Get Certified in ITIL, with Cognixia!

If you’re looking forward to getting ITIL 4 certification or upgrade from ITIL v3, Cognixia can help you! Being the world’s leading digital talent transformation company, we offer a complete portfolio of ITIL Certification & training, including ITIL 4 Foundation Certification. Learn from the comfort of your home, with our comprehensive ITIL 4 Online Training.

Our Course Covers:

  • The concept of a service
  • Services, risk, cost, and service management
  • Service relationship management
  • Four dimensions of service management
  • Guiding principles of service management
  • Service value system
  • Service value chain
  • General management practices
  • Service management practices
  • Technical management practices
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