The Evolution of IT Cost Management with Eric Russo of Bridgepointe

Author: Scott Kinka

On this episode of The Bridge, I’m joined by Eric Russo, Senior Vice President of Lifecycle Services at Bridgepointe. We’re talking about IT cost management and why it’s become a top priority, second only to cybersecurity.

The Bridgepointe Lifecycle Services team advocates for their client’s success during every step of the technology lifecycle, from sourcing through implementation and ongoing expense/mobility management to negotiating their renewal. Having completed thousands of client projects resulting in millions of dollars in savings for clients, working with Bridgepointe’s Lifecycle Management Services team helps clients drive greater efficiency while proactively managing their technology costs.

During our conversation, we got into how the post-pandemic budget run-up is over, but the demands on it to deploy next-gen tech, like AI, have never been higher. We also parse out why cost management is a more important priority than data analytics, cloud, automation, and AI, and the role procurement experts play in optimizing technology spending.

Topics covered in this episode:

  • Eric’s background and experience.
  • Eric’s business superpower.
  • The importance of cost management, optimization, and containment in the IT industry.
  • Why many companies are focusing on reallocating budgets for digital transformation projects and AI initiatives.
  • Why ROI is an essential factor in justifying technology investments.
  • The importance of finding cost savings and optimization opportunities in technology spending and how it impacts business cases for technology investments.
  • The impact of COVID-19 on the mobile landscape and how it varies for different customers.
  • The challenges businesses face in rationalizing their communication investments and the role of Bridgepointe in helping businesses make informed decisions about which solutions to keep and transition to.
  • The importance of understanding users’ requirements and leveraging Bridgepointe’s expertise in technical requirements gathering to make informed decisions.
  • Bridgepointe’s involvement in managing digital transformation, including the transition process and managing organizational changes.
  • The increasing use of RFPs (Request for Proposals) by businesses to validate their technology decisions and how Bridgepointe helps customers navigate the RFP process.
  • A shameless prediction for the next 18 to 24 months.
 

 

ABOUT ERIC RUSSO

At many large enterprises, IT departments are limited by their tech budget, headcount, and legacy systems that turn new initiatives into huge headaches. We’ve been helping the heads of these departments overcome these limitations for over 25 years.

We take a deep look at your tech stack, your operations, and what it all costs in order to find opportunities to improve. But we don’t stop there. Like other companies, we’ll analyze where you can improve and give you detailed, accurate reports and recommendations.

Unlike other companies, however, we’ll actually take some of that work off your plate. So that your headcount isn’t tied up managing thousands of invoices or wrangling the service and support for every desk phone or mobile device in your company. And you can finally see beyond the daily wave of “break/fix” projects and start on that digital transformation you’ve been planning.

CONTACT ERIC

Web. https://bridgepointetechnologies.com/team/ericrusso/

LinkedIn. https://www.linkedin.com/in/erusso/

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Scott Kinka:

Welcome to another episode of The Bridge. As we promised on our end-of-year recap, we’re going to spend a little bit more time, live a little bit more time with some of the folks from Bridgepoint so you can get to know some of them and get to know our experts out there in the field. And we just happened to be here at Normandy Farms doing our Lifecycle kickoff. And with me, and I’ll explain what that is in a minute, but with me is Eric Russo, who’s our Senior Vice President of Lifecycle Services. Welcome to the podcast, Eric. How are you?

Eric Russo:

Yeah, I’m doing great. Thanks for having me. This is awesome.

Scott Kinka:

What are we doing today here at Normandy Farms?

Eric Russo:

We are kicking off our year with our team Lifecycle services as part of Bridgepoint. We’ve been with the company for about a year now, and this is typical for what we do in the beginning of the year to recap 2023 and then to talk about what we’re trying to accomplish in 2024.

Scott Kinka:

Got it. And I jammed this in before Eric got coffee. So if he’s cranky with me, it’s a hundred percent my fault as we go through this.

Eric Russo:

And breakfast

Scott Kinka:

Well, Eric, I appreciate you sitting down for us with us for a little bit. I have a couple of notes here I just want to hit you with and we’ll talk through ’em. But let’s just start by, we always start by getting to know our guests. Tell us a little bit about Eric Russo, where you’re from, where do you live, kids, what’d you like to do? Just give us some background.

Eric Russo:

Oh yeah, so I moved around a lot as a kid, but I ended up in, well, we’re Normandy Farms in Blue Bell, Pennsylvania. We’re outside of Philadelphia. I ended up outside of Philadelphia because I went to Villanova and my wife is from the local area too, so we ended up staying here. So I’ve been here the longest of my life and my kids are, I have two teenagers, one’s 14 a girl, and then a 17-year-old boy and all of the typical trials and tribulations with teenagers obviously. And then I’ve been with the prior company to Bridgepoint for 12 years. Before that, I worked mostly in high tech, so I’ve worked for Cisco, I’ve worked for Symantec, I’ve worked for some startups, and I’ve been doing this for about 30 years. So a good amount of experience just in terms of the tech world.

Scott Kinka:

Fantastic. And your kids are going to be thrilled that they can search you by name on Apple Music and Spotify

Eric Russo:

My 14-year-old was a little horrified. She’s thrilled. She was a little horrified that dad-

Scott Kinka:

Love that.

Eric Russo:

Dad’s going to be on a podcast, but I tried to explain to her that Kinka, he’s got about a million pieces of content out there. I’ll have one.

Scott Kinka:

Hey, it’s all good, but it’ll be a good piece of content. We’re looking forward to it

Eric Russo:

Yeah.

Scott Kinka:

So, alright, I’ll ask you one more question about you and then we’ll get into talking about Lifecycle a little bit. And I always ask this question, I know that you’ve seen other episodes of the pod, but what’s Eric Russo’s superpower? What’s your work superpower?

Eric Russo:

Oh boy. I think getting our team together behind customer requirements and initiatives. I think being able to understand what the customer needs are and then not only help them personally, help fulfill, but also the 50 associates that sit behind me just in terms of fulfilling those customer needs.

Scott Kinka:

Got it. Got it. And we’re going to talk a little bit about what Life Cycle is in a moment, but let’s just talk about the why first. So our listeners know we do lots of live events and in fact, we had a great two-part episode around AI that was captured at our summit in Palm Springs this past year. And what maybe the listeners don’t know, or certainly people who weren’t there know is that that was a three day event. I kicked it off with a keynote, but immediately following the keynote, we went straight to you and Chris really as the beginning of the content. And we started by talking about cost management, optimization containment, which are like, wow, we have a three day conference and all these suppliers here, why are we going straight to that? But the reality of it is, it’s top of mind and it remains top of mind. In fact, it’s increasing statistically. Tell us a little bit about your experience in the field related to that and really, I mean why now? Why are we still having this conversation about containment? What’s unique about today?

Eric Russo:

I think just at a high level, some of the macroeconomic headwinds that we’re seeing, it started with COVID obviously just in terms of businesses that we were kind of stuck in the mud for a while. And then even though we came out of COVID, we’ve had some bouts of inflation supply chain, if you recall, all of that. So while there’s still some legacy of that, even business inertia seems to be a little bit stuck. We’re not on a significant growth path. So because of that, businesses are looking at ways to optimize their IT spend in order to harvest some cost savings to invest those cost savings in technology that enables the business. So what we get a lot from our clients is how can you help me? And savings is one thing, but it’s less about savings and it’s more about optimization and it’s more about how am I utilizing my assets to the best of the ability that I can or is not only potentially drive down savings of existing, but then it’s also what technology can I bring in that delivers better value for same or less cost. So I think those are pretty compelling drivers because lastly, even though AI is a huge thing, there’s not a lot of budget out there for it to make investments and even trial projects determine the ROI and that sort of thing. So we’re working with clients to really help them harvest some of that budget, reallocate it to some of these projects that can help the business. And one of the big things is digital transformation. Well, you can’t digitally transform until you can get some money to go and do that.

Scott Kinka:

Yeah, yeah. I mean, you answered my objection before I asked it, right? We’ve spent, I feel like every episode that we had in this second six months of the year, I don’t care who it was with, it could have been with a data center provider or a UCaaS provider or CX provider. They all devolved into an AI conversation. So what I was about to ask you, and you already answered it, but it bears restating was like, well, okay, well we’re talking about all this new stuff and you’re talking about cost containment, but your point is that containment and optimization is really around finding space and budgets for investment right now. So companies are investing, they’re just not investing more, right? I mean, what’s happening with you? You shared some interesting data. I think it was from Bain or I think it was Bain at the summit about what’s happening in IT budgets and over the last couple of years since covid, is that rising, shrinking, staying the same? What are you seeing? Pretty flat?

 

Navigating the ROI Challenge

Eric Russo:

They’re pretty flat. And one of the things that struck me, but also the rest of our company just in terms of, was that security is the number one priority, but cost containment, cost optimization is number two behind big data. I’m sorry, ahead of big data ahead of AI ahead. So clearly the IT leaders, I’ll give you an example. We have a large retail customer, thousand stores that’s doing relatively well. I think they’re privately, they’re privately held, but right now the CEO is reviewing any purchase order that’s $50,000 more than what was budgeted in 2023 for 2024. He wants visibility into all that because he’s trying to get a grasp on where’s the money going? Is this an investment that we want to make? So that same customer tasks us as part of our engagement tasks, us to find cost reductions every year, and we deliver upon that. That’s part of our engagement with them. And just to take a step back on that, we work with them in terms of giving them visibility into what their spend is. And because we have some pretty interesting ways to give them well and good ways to give them visibility into their spending, we’re able to make recommendations and things like that. But at a higher level, from a business perspective, you’ve got a CEO of a thousand chains, a thousand stores reviewing purchases over 50 grand, sorry, 50 grand delta.

Scott Kinka:

I mean super interesting. And you mentioned, I want just something pop in my head as you were going through that you said ROI. So it’s one thing to go in and say, Hey, let me, and look, we know, I mean IT leaders out there, I know you’re not inspecting your bills, let’s be honest. And that’s kind of the unsexy part of this. Let’s all be honest with each other. We’re friends, but we know we’re not doing that and we know that there’s that in every company’s invoicing because it just happens. Tariffs and taxes and all this stuff, and particularly in legacy telecom and those kinds of things, drift. But let’s take that off to the side for a moment because it’s necessary and unsexy, right? But you did mention ROI, which is sort of the bridge to sexy stuff, you know what I mean? Are you guys being tasked with that side of the equation also by your customers? Tell me more.

Eric Russo:

Yeah, so just yesterday had a totally different customer, a very high amount of money that they’re managing has had an inbound from Microsoft to use copilot, which is ai. So that’s why I brought it up. And so they said very specifically to us, what are you doing? Microsoft is telling us that we need to use copilot, and they’re telling us that that is a great value and it’s worth every dollar that you pay for it. What are you guys seeing from your customers to help us justify the investment in copilot? Just an example,

Scott Kinka:

Which is, I mean it’s I’d say $20 per head?

 

Eric Russo:

$30 per head overlay.

Scott Kinka:

Okay, gotcha.

Eric Russo:

360 bucks a year. And the CIO specifically said, help me understand why I should spend $360 a year. And it’s not that he doesn’t want to,  He wants to really justify it. So in another conversation I was having later in the day with the retail store, we talked about it and we started to talk about what are you guys going to do and they’re going to try it. And their justification was, well, if I get an hour back each week from every person that uses it, I can probably justify it productivity increase. So to your point, so those are the discussions that we’re having and that’s just, but then we also do that with other technology and help the customers put business cases together to justify the investment in whatever it is, whatever technology that they’re rolling out. Most recently, we have a large company that we’re going to help jump in and manage mobile. They’ve got to go to their board to say, we want to use these folks to manage mobile. And so we’re providing them with cost offset, what it’s going to cost for us, what the offset is, helping them build that business case so they can go present it to their board and say, Hey listen, it’s better for us to use bridgepoint to do this work, and here’s all the things that they’re going to deliver us. And by the way, our people can now focus on this. Here’s the cost reduction and that sort of thing. So we’re constantly working with it

Scott Kinka:

Cost management. Take mobile as an example. Plan optimization is not something people do every day. Just forget about the hour back. You guys are just going to be better at it than somebody else’s. But before we jump there, I want to talk global for a minute. Lemme just go back to AI for one moment. Sure. Because you mentioned, I just wanted to say that we’ve had a lot of discussion on the podcast lately with our supplier partners and they’re like, we’ve been sort of equating AI today to cloud from five, six years ago where it was these corporate level edicts. We’re going to do AI now. And you’re like, “What’s the use case? So I’m just trying to tie a little bit of what you just said to what’s going to happen in the last handful of episodes. You guys are doing contract consulting work to help companies find use cases effectively that will then generate TCO to make AI investments. Save the money, optimize to invest in it, and then help build the ROI and find the use cases to be able to push the thing forward.

Eric Russo:

And to be clear, we’re not AI, in particular, experts, right?

Scott Kinka:

Well, you’re procurement experts.

Eric Russo:

Yeah, we’re procurement experts. So what we do is we take an existing set of technology that they potentially have and look at that existing set of technology and say, Hey, can we optimize this? And you and I have spoken in the past about cloud optimization. So potentially if they’re a public cloud, can we go in and find some optimization in the public cloud? Can we go in and find optimization in the data center? Can we go in and find optimization in software? Can we go in and find optimization in telecom across the board? And so then we work with one particular client that gave us all of their contracts and it spends a little smaller, and across the board, they’ve given us carte blanche to go in and help them optimize what their spend is. And in some cases they’ve gone up because they’ve said, you know what?  We want to spend the same amount of money, but we’re going to get more from it. So we’ve gone up in terms of what they’re procuring, but we’ve kept the level. In some cases they’ve reduced. In some cases they’ve found another vendor and changed the way it is. But all of that money that we take out now goes back into it. Typically IT budgets are set for the year. So if we can affect an in year budget, which we try and do, they don’t have to go back to the company when they want to make an investment,

Scott Kinka:

Stays in the coffers

Eric Russo:

It stays right in the coffers.

Scott Kinka:

I get it. I get it. Super interesting. Lemme jump back to mobile for a moment because again, that sort of falls in that category of everybody has one. So the reality of it is, I mean how’s the mobile landscape changed dramatically since covid? I mean people are home and they’re on personal devices, or is that just sort of a condition that people are expected to have mobile phones and it is what it is.

Eric Russo:

I think there’s no signal in the noise. Some, it has changed dramatically to the point where UCaaS seats are gone because everyone has a mobile phone. But other customers, it’s business as usual where they provide devices, I’ll tell you. So it really depends on the customer. What we’re seeing is as always, there’s a trend downward in terms of what the spend is. So if you have customers pre pandemic that have never looked at their contract, it’s pretty significantly less. So it all depends on the customer, where they’re going mobile wise, but they, oh, that’s what BYOD. So there’s always some discussion that seems very consistent. We were going to go BYOD, BYOD, but many of our customers that consider it don’t do it because of the security implications because they can get a better deal because of the issues we provide stipends and how the taxation and things like that. So most customers that are providing customer owned devices continue to do so don’t go BYOD. And other customers who have UCaaS seats or work from home or whatever have now said, just use your mobile phone and go that way.

 

Rationalizing Communications Expenses in a Post-Pandemic World

Scott Kinka:

The interesting tie into UCaaS, this has come up a handful of times in recent weeks. I read, gosh, probably a year ago, it was a Gartner study that said that companies communications investments. So I figured that’s traditional telecom, it’s UCaaS, it’s mobile, and then it seems like meetings and Zoom and investments went up by 30% in the pandemic. And now businesses are really trying to rationalize that. I’ve got some meetings over here, but we’re doing teams and those meetings aren’t so bad anymore, and I could do phone there, but I have this UCAS over here and the mobile, are you guys seeing that in the field? Just sort of help me rationalize this pile of comms stuff I have.

Eric Russo:

Yeah, definitely. And one of the things that continues, right, I don’t know how much install bases out there are premise based stuff, but in our particular customer base, a lot of Cisco was deployed and so is there’s trying to figure out what we’re doing with the Cisco and then moving, and then Microsoft is pretty ubiquitous just in terms of, again, our customers. So we see that. So we work daily on projects related to what I am doing with this infrastructure? Am I keeping it? Am I going to teams? I love Zoom, how do all these things play together?

Scott Kinka:

For sure. And are you guys involved in that rationalization? You’re like, which use cases are for what? Who likes what? I mean you’re sort of building the mapping, not just to help optimize the expenses, but making recommendations on this is what your company is telling us is they’re using and how they’re working.

Eric Russo:

Yeah, I mean one of the big things that we bring is other customer experience and things that we’ve done. And I mentioned just taking a step, finding RI and getting a budget and going to apply for it. But one of the things that I neglected to say is not only do we help customers rationalize that technology, but then we also help them implement it. So one of the big areas that we’re in the middle of is implementing some of that either moving from Cisco Prem, Avaya Prem to zoom, Cisco prem. So when they make that technology decision, they instead, because people are short-staffed and they want to get it done more quicker than if they did it themselves. And so bridgepoint helps them with their transition. So not only to make the decision, understand the financials of the decision, but then we also help them transition it.

Scott Kinka:

That goes as far as people management, like your PMPs, you’re in there, it’s digital transformation management, like managing the chaos in the org during the conversion.

Eric Russo:

And if you look at the continuum in terms of how we help our customers in general, we work with a customer to understand what their technology directives are for a year. And as we’ve discussed earlier, if you look at the broad view securities number one, but number two is this kind of cost optimization. So then we get engaged with them around cost optimization and it could take the form of mobile, it could take the form of reconciling these different platforms, all of that. And so we help them procure that, so IT procurement, and then once we help them procure that, then we help them transition it. And then once it’s transitioned, we help them manage it from a financial perspective and make sure that we understand what their inventories are, visibility into that inventory, visibility into the spend and that sort of thing. So it’s across the entire continuum, just how we help them manage all of that.

Scott Kinka:

I have one last question about containment then while we’re talking, which has all of this kind of, I hate to say increased urgency, let’s just say continued urgency around keeping budgets static and like you said, but there is urgency. I should probably walk that back a little bit around like you told the story of the CEO O, who’s looking at every invoice when the next transaction comes up. Let’s talk about the dreaded RFP for a moment. Our businesses now more along the lines of, Hey, used to allow it to just do this, but now I’m going to need evidence of, is that happening more frequently today?

Eric Russo:

Yeah. We have several customers that in order to procure now, they need to get a market-based validation that their decision is correct. And the only way to really do that effectively is to run an RFP process. So our team has been running RFPs for 15, 20 years. We have a defined process, but it really is about, I have to say it’s less about the savings and driving down costs, it’s more about market validation and also making sure that the company understands its requirements and sending those requirements out to a select group of people that can meet those requirements, understanding how they’re going to meet the requirements, the financial aspects of it, and then moving into contract.

Scott Kinka:

Do customers really know what their requirements are when you go in?

Eric Russo:

No

Scott Kinka:

You’re then that rationalization process of what do you actually want? You think you know what you want, but let’s go talk to your users, let’s get that together.

Eric Russo:

Exactly right. And one of the great benefits of bridgepoint is besides the team that can run RFPs, we have these engineers that understand the market, understand, have valid customer data where we draw upon their technical expertise as far as requirements gathering and that sort of thing. And so they engage with us. Where our team are IT procurement people, they’re not necessarily technical. We draw across, we pull from the bridgepoint engineering team, which are excellent, and they help us to develop those requirements. And then there’s a great customer, we could provide significant value to the customer beyond just running a process.

Scott Kinka:

Yeah. Well, this was a great conversation. I know you’re going to be very busy today. IT procurement, cost containment, cost optimization, finding the dollars in the existing budget to make the investments in all the crazy things that we talk about here with our suppliers on the podcast. These guys do it better than anybody. Eric runs all of that. So again, Eric Russo is our senior Vice president of Lifecycle Services, but before we end, three fun questions.

Eric Russo:

Oh boy. Okay. All right.

Scott Kinka:

First, What’s on your nightstand? What are you reading right now? Is there a tone you’re reading? Or you could say, what’s your favorite business book if you’re not reading something right now?

Eric Russo:

Oh, Zero to One, Peter Thiel.

Scott Kinka:

Short synopsis?

Eric Russo:

It’s basically taking a company from zero in the binary to one.

Scott Kinka:

Yeah. Perfect.

Eric Russo:

Yeah. Zero to one for sure.

Scott Kinka:

Alright. The second one is when the world ends or the next Covid Happens. We’re in our dystopian future, and there’s one app that’s still functioning on your iPhone. Which one is it and why?

Eric Russo:

Email. I mean, that’s no fun.

Scott Kinka:

So give me something fun. Yeah.

Eric Russo:

Oh gosh, what do I

Scott Kinka:

I’m putting you completely on the spot.

Eric Russo:

Yeah no, I mean I am trying to think of what apps I use. Spotify.

Scott Kinka:

It’s funny, I told Gene Apple Music last year on our end of year episode, and I told him this year it would probably be the same. Although I am, I’m digging Apple News right now. I’m probably using that more than going to the web. I find I can actually curate my news and adjust my cone of beliefs a little bit better by trying to curate it. So that’s interesting. Best answer I’ve ever had, by the way, was a flashlight. Oh yeah. Think about it. What the hell do you need anything else for? It’s the end of the world. That’s right. Flashlight’s there. Alright, last one, a little bit more businessy, give me some kind of prediction. 18 to 24 months. It actually doesn’t need to be business. It could be macroeconomically, it could be sports. I don’t care. Give me something that’s going to happen and we’ll look back and laugh at this in the future.

Eric Russo:

At some point, I think, listen, I came up in the internet boom and I worked for Cisco in the internet boom, and we were connecting everyone and everything. I do think that in the next 18 to 24 months, we are going to experience another boom like that. Maybe in ai, maybe in digital transformation there will be some transformational wave that comes along that organizations will be taking advantage of. And most likely it’s going to be AI, but it could be crypto just in terms of transactional deals with companies and that sort of thing. So something like that. I think there’s another wave coming

Scott Kinka:

And businesses are going to need to find a budget to fund those with whatever’s Is in their existing expenditures. And that’s why you guys are here. Yep. All right. Well, thank you, Eric. All

Eric Russo:

Alight. Thanks.

Scott Kinka:

Thanks for listening to this episode of The Bridge, and we will catch you on another episode.

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