Management asks you to cut technology spending. You have invoices for cloud hosting, software and support, but each supplier's owner argues against a reduction.
Start your technology cost review by mapping those purchases to the work your team does. Before cancelling a subscription, check which tasks people would have to take on without it.
Start with a service, then follow its costs
Choose a business service: taking an order, producing a customer report, or releasing the application. Identify the software, infrastructure, people and support contracts required to keep it working.
You may find two subscriptions supporting the same job, or hours of reconciliation behind a cheap platform. Include the contractor maintaining an integration in that platform's running cost.
Ask finance to reconcile the payments and the service owner to explain the work. An engineer should check the dependencies before you approve a change.
Use a cost register you can act on
Record each proposed change in a register:
| Field | What to establish |
|---|---|
| Business service and owner | Who needs this capability, and who accepts a change? |
| Current cost | Subscription, usage, support and identifiable operating effort |
| Commitment | Renewal date, notice period and minimum purchase |
| Proposed change | Remove, reduce, renegotiate, integrate or retain |
| Implementation cost | Migration, testing, training and overlapping contracts |
| First invoice affected | When cash expenditure can actually fall |
| Acceptance test | What must still work afterwards |
Keep the current invoice beside the proposed charge. Record how you will reduce the bill and the date the supplier will apply the change.
Keep separate totals for cash released and staff capacity recovered. Removing five hours of repetitive work can be valuable without reducing payroll. Counting both the hours and a hypothetical salary reduction inflates the business case.
Compare the first year with the steady state
For this illustrative calculation, use AUD and the same tax treatment throughout. A business expects to remove $900 a month of subscriptions and support. Migration costs $6,000 and starts after three months of the planning year.
The annualised recurring reduction is $10,800. But that planning year's gross cash reduction is nine months at $900, or $8,100. After the migration, the net reduction is $2,100. Simple payback takes roughly 6.7 months after the old charges stop, assuming the full monthly reduction is achieved.
Report the annualised reduction, this year's net reduction and payback period in the proposal. Update the forecast if the migration slips or you renew the old contract.
Fund the review in the right order
Establish the baseline
Reconcile invoices and commitments, and assign an owner to each service. Include annual payments and foreign-currency exposure.
Find changes within existing contracts
Look for unused capacity, unnecessary add-ons and duplicated work. Confirm whether a change reduces a bill now or only at renewal.
Cost the harder changes
Price integration, consolidation and platform replacement against the current way of working, including transition costs.
Verify the result
Check the invoice and service outcome after implementation. Keep an owner responsible for any expected saving that has not appeared.
A virtual CTO can connect these decisions to the roadmap and challenge estimates across suppliers. Keep a service unchanged if you cannot justify the cost of altering it.
Include software and AI spending
The FinOps Foundation's 2026 survey identifies workload optimisation as a leading current priority and reports broader attention to SaaS and AI expenditure. Its respondents are FinOps practitioners, rather than a representative sample of Australian small businesses. Use the survey to inform the scope of your review, then calculate a savings target from your own purchases.
Frequently asked questions
A reconciled baseline, a prioritised list of changes, implementation costs, contract dates and acceptance tests. Each approved action needs an owner and a date when the bill should change.
A uniform reduction ignores what each service does. Compare avoidable cost and business impact before setting a target for individual services.
Finance reconciles the payments, each service owner explains the work a cost supports, and an engineer checks dependencies before a change is approved. Include whoever manages the contract so renewal and notice dates are not missed.
Report them, but keep them separate from cash. Recovered hours are capacity for other work unless payroll actually changes, and counting both inflates the business case.
Put a defensible cost plan in front of management
MyTechTeam can review technology spending, dependencies and delivery priorities with your team.