Cost Optimisation is often overlooked—either dismissed as a buzzword or assumed to be an obvious process—yet it is rarely applied correctly within Information Technology (IT).
In this series, we’ll focus on how to practically apply Cost Optimisation across a digital estate (IT environment), starting with a common but underestimated topic: redundant software.
What is Redundant Software?
Redundant software, as the name suggests, refers to the use of multiple applications, systems or services—which we will collectively refer to as ‘software’—that serve the same purpose or provide overlapping functionality.
While this has always been an issue for organisations, it has become more widespread in recent years due to the rapid proliferation of cloud-based services and their ease of adoption – particularly Software-as-a-Service (SaaS) offerings. In many cases, such redundancy arises from scenarios such as:
- Users or decision-makers being unaware of features within existing software.
- Preference or familiarity with alternative vendors or platforms.
- Preferred (nonessential) features prompting adoption of additional software.
- Disconnected departments operating in silos, purchasing software independently without central governance.
Common examples include:
- Using Microsoft 365 with Teams licensing, while also using Zoom or Slack.
- Running storage solutions in both Microsoft Azure and AWS.
- Using Windows Operating Systems and Mac Operating Systems.
- Using Google Drive along with Dropbox.
- Using Claude AI or ChatGPT while already licensed for Microsoft 365 Copilot.
The Hidden Costs of Redundant Software
While the obvious cost impact of redundant software is duplicated licensing fees, what’s often overlooked is the hidden cost – the additional burden of managing this superfluous software.
In both traditional and modern digital estates, these hidden costs primarily stem from the seemingly intangible expenditure associated with the requirements for effective operation, including key functions such as governance, management, support, security and compliance. To fulfil these requirements, organisations must invest valuable IT resources, primarily in the form of personnel, time and effort, and additional costs where required (e.g. for additional licensing or hardware). As redundancy increases, these resource burdens multiply, sometimes exponentially, often leading to one or both of the following related outcomes:
- Insufficient IT resources, resulting in gaps in governance, management, security, or compliance—affecting one or more instances of redundant software.
- Unnecessary resource depletion, where excessive effort is spent maintaining redundant software, creating deficiencies in other critical areas of the digital estate.
And while cost is the core concern in a Cost Optimisation discussion, risk is an equally important consequence—particularly when resources are stretched too thin to maintain adequate operational capacity, security and compliance.
A Simple Analogy
Rather than expanding on the digital example, consider a more relatable comparison: a car.
When purchasing a car, the cost isn’t limited to the price tag. Ownership comes with recurring and variable costs:
- Registration
- Insurance
- Maintenance
- Fuel
- Cleaning
- Occasional repairs
Now imagine buying a second car that serves the exact same purpose. You’ve essentially doubled those costs – without doubling your value. That same money could have been better spent on another requirement in your personal life, such as a necessary home repair.
This is exactly what happens in IT when redundant software is introduced: resources are diverted away from more important needs due to duplicated functionality.
Balancing Redundancy with Resilience – DR & BC Considerations
It’s important to acknowledge that not all redundancy is wasteful.
In fact, intentional redundancy is essential for Disaster Recovery (DR) and Business Continuity (BC). Many organisations implement failover or duplicate software by design – to protect core operations in the event of outages, attacks, or other disruptions.
These redundancies are carefully planned, budgeted, and maintained as part of a broader resilience strategy.
The focus of this article, however, is unplanned and unnecessary redundancy – the type that exists outside of DR and BC planning and simply adds cost and operational overhead without serving a clear purpose.
The key is being able to differentiate between strategic redundancy (for risk mitigation) and non-strategic duplication (which inflates cost and risk).
Optimising Expenditure on Redundant Software
Understanding the issue is only the beginning. Addressing redundant software can be tackled through both proactive and reactive approaches.
Proactive approach
Enhance the organisation’s software procurement process by including checks for overlapping functionality during initial assessments. This evaluation step can be included as part of a streamlined procedure, incorporating other important factors such as business justifications and cost-to-benefit analysis.
Additionally, incorporate continuous optimisation processes which look to continually evaluate the changing capabilities of existing and new software in the market. In the context of this article, this process should have the objective of identifying new functionalities which can be leveraged to consolidate and/or replace existing software.
Reactive approach
Conduct a once-off comprehensive review of the current digital estate. This process should assess existing software, user requirements, and business needs. When redundancies are found:
- Consolidate where possible.
- Where consolidation isn’t viable, consider platforms that combine multiple software/functionalities.
Conclusion
In Part 1 of this series, we’ve explored a practical and relevant application of the Cost Optimisation principle – redundant software. This is a common issue affecting organisations of all sizes, often growing unnoticed over time.
As we continue through this series, we’ll look at additional areas where Cost Optimisation can be applied meaningfully across digital estates. As we conclude this part however, the key takeaway is this:
Cost Optimisation is not just about cutting costs—it’s about identifying value, eliminating waste, and reallocating resources to where they matter most.
