Optimizing IT Costs: CAPEX & OPEX
IT costs are generally categorized into two main areas:
- CAPEX (Capital Expenditure), which represents investments in changing or transforming the business.
- OPEX (Operational Expenditure), which represents the costs of maintaining and running the business.
Crossjoin provides tailored services to address both areas. However, we often see significant benefits when tackling costs by acting in the opposite area.
For example, consider a solution in production that is not meeting its KPIs. Clients often prefer to completely redo the solution, leading to substantial investment in a new development project. When Crossjoin is involved, we focus on preventing these unnecessary costs by fixing what appears impossible to resolve. This approach reduces CAPEX costs by optimizing existing solutions instead of recreating them from scratch.
In the CAPEX area, over the past three years, we have supported clients in transformation projects by focusing on three key dimensions:
- People
- Processes
- Technology
As we can talk client business language, as well with the cross-technology know-how from multiple technologies and well-known products, we leverage decisions to a well-sized IT in these 3 vectors.
To prevent future OPEX costs during these transformation initiatives, it’s essential to ensure that these three dimensions are well-aligned and properly scaled. With extensive experience in development, tuning, infrastructure, and client business operations, Crossjoin supports decision-making throughout transformation projects, ensuring IT investments are optimized and well-dimensioned.
Moving to the OPEX area, Crossjoin is often challenged to help clients reduce costs related to their existing infrastructure. This work typically involves 3 dimensions:
- Reducing Costs with Legacy Systems
For example, optimizing MIPs in mainframe systems. - Optimizing On-Premises Infrastructure
Through tuning and optimization services, we help clients decommission assets, reduce resource usage, and redesign IT infrastructure to achieve “more with less.”
- Application flows or migrations to the cloud and SaaS products.
Here, Crossjoin plays a crucial role in IT control by:- Ensuring cloud migration costs are well-managed and under control:
- Providing proactive initiatives to reduce infrastructure costs;
- Guaranteeing that SaaS products are customized and configured according to best practices.
By acting across these areas, Crossjoin effectively reduces both OPEX and CAPEX costs, leveraging our cost management framework to deliver tangible results for our clients.
Why Crossjoin Solutions
Depending on the level of maturity, but assuming a low level of maturity, for an infrastructure cost reduction initiative, you need someone who understands the bill and translates the cost to the infrastructure asset, then you need to calculate its contribution to the total, which requires financial proficiency in the client’s environment and its IT. In addition, you need to be able to technically analyze the asset to identify the reason for this cost. As there are several assets in various technologies, several teams are needed to carry out the analysis and identify reduction initiatives. They need to be planned, monitored and confirmed.
So instead of having many teams involved, making the process slow and the initiatives being implemented at a slow pace, Crossjoin does this end-to-end with very few dependencies, we can close the loop from the financial part, to the calculation, detailed analysis regardless of the technology and then change what needs to be changed to achieve the identified cost
Case Study Example
1. Infrastructure Cost Reduction – Tier 1 Telco
Challenge: With a €2.7 million increase in cloud IT infrastructure costs, the client sought to reduce expenses without impacting system availability or performance.
Solution: Crossjoin led initiatives to decommission redundant applications, optimize server storage, and manage server resources more effectively.
Outcome: Achieved €2.17 million in savings, reducing cloud infrastructure costs by over 31%. The client continues to benefit from ongoing cost management support to maintain and enhance savings over time.
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