The Australian Federal Attorney General's Department has slashed software spending by 18% a year following a widespread review of existing contracts.
The department's CIO, Graham Fry, says the goal was to avoid being "bogged down by existing contracts and infrastructure".
Since being appointed to the role three years ago, Fry has been seeking greater agility in the area of procurement.
"We did a few things, like negotiate a change from CPU-based [licensing] to headcount [-based] so we weren't paying for licences that weren't being used," Fry says. "We put competitive pressure on licensing across the board."
With savings around 18% — more than A$120,000 (NZ$132,000) a year — it is an ongoing saving.
Fry says licensing is reviewed regularly through a special group established to tackle the task.
The process is tightly managed, he says.
"It can be a bit time consuming, but it pays for itself."
Asked about using open-source software to further reduce cost, Fry says that while he is not "closed to open-source" he is "very conscious" of the cost of migrating.
"I'm cautiously open to it and we do use open-source software in three different spots in the organisation [but] it's just another set of software to be evaluated," he says.
The department's existing use of open-source is not in "big ticket items", but it is used on back-end systems for data transfer.
"The software procurement [project] was just part of a general strategic model for sourcing," Fry says. "Software is part of the bigger picture where we work with the contract instead of just picking things off the shelf."
He says agility is important because the department needs to maintain a quick response time. For example, it is the department's responsibility to manage secure communications for Commonwealth Heads of Government Meetings.
The department has just completed a server consolidation project which has since seen virtualisation become an integral part of its infrastructure.
"We had a lot of servers for our size so I sat down with operations and worked out the servers and their functions," Fry says. "We used VMware so we could fit more apps per server."
So far, the department's server count has reduced from 100 to 50, and although the exact numbers are not known, Fry says cost reduction was "reasonable", but the big saving was in staff time.