IT Cost Optimizations Net 20% IT Cost Reduction for Large Hospital

IT costs are operational costs, and any procurement or finance-facing IT pro knows just how much of the average healthcare budget goes to keeping the technological lights on. But when you connect with the right IT consultant, your organization can streamline costs substantially. 

Healthcare providers also need IT guidance from experts who understand their industry at a deep level. We at Profit Advisory Group (PAG) have helped numerous healthcare facilities save considerably on their overall IT costs—with IT cost optimization strategies that trim big sums from their tech spend. This spotlight features the story of a 250-bed hospital that saved 20% to reinvest with our help. 

The Challenge

Like any other healthcare facility, this 250-bed hospital was grappling with rising IT costs. Their sprawling, complex infrastructure included electronic health record (EHR) systems, imaging and diagnostic tools, administrative software, and cybersecurity measures. Yet despite significant tech spending, the team simply wasn’t seeing an equivalent return on investment.

Although the team was highly motivated to slash costs, compromising on service quality or uptime would not be an option — patients and employees alike expected good working technology and access to cutting-edge tools. Stakeholders strongly suspected there were savings hidden in the complex IT estate, many of which could be eliminated with marginal impact on the computing environment. 

The hospital’s team reached out to us in search of an IT cost reduction framework that would satisfy their requirements and confirm their suspicions, and we immediately set to work. 

The Approach

PAG’s process began with our signature risk-free IT audit, an exhaustive assessment of the hospital’s existing technology that provided a foundation for the IT cost optimization strategy we implemented. The audit analyzed IT infrastructure, systems, software, contracts, and service level agreements to identify areas of inefficiency, overlap, and waste.  

Soon after, the hospital and our team had uncovered multiple savings opportunities: 

1. Legacy System Phasing: The hospital was maintaining outdated legacy systems alongside newer technologies, leading to unnecessary expenses and inefficiencies. The legacy tools could also pose a significant security risk that would compound as time went on. 
2. Contract Consolidation: The hospital had multiple contracts with various vendors, some of which offered overlapping services. 
3. Cybersecurity Optimization: Although cybersecurity is a necessary investment, we identified areas where the hospital was overspending on redundant security measures — a common oversight committed by well-meaning stakeholders that assumed the only path to stronger security is increased spending. 
4. Cloud Migration: Some hospital functions were still running on local servers that required constant maintenance and periodic upgrades. By moving to modern cloud alternatives, the hospital could consolidate even more vendors, immediately enhance employee-facing tools, and future-proof its overall tech estate. 

The Solution 

Based on the findings of the IT audit, we crafted a comprehensive IT strategy:

1. Legacy System Phasing: We developed a phased plan that would enable a transition to modern, cost-effective alternatives without overwhelming hospital staff or finances.
2. Contract Consolidation: We negotiated with vendors to consolidate contracts and eliminate redundancies, leading to substantial savings.
3. Cybersecurity Optimization: We streamlined the hospital’s cybersecurity measures — focusing on comprehensive, cost-effective solutions that didn’t compromise patient data security. The same moves allowed us to eliminate numerous redundant or overly expensive security solutions from the annual IT budget.  
4. Cloud Migration: We initiated a strategic migration of certain hospital functions to the cloud, reducing maintenance costs and improving scalability and accessibility. 

The Result

Under these measures, the hospital achieved a 20% reduction in overall IT costs while maintaining — and in several cases, improving — operational efficiency, technical flexibility, and patient care quality. 

Ultimately, this story is a testament to the power of a strategic IT asset management process. It’s also the kind of outcome we excel at bringing our healthcare customers. Contact us today and get started on a journey that reduces spending, increases vendor/IT value, and puts control of your tech estate’s future back in your organization’s hands.