Capital Risk Avoidance
Context & Stakes
Following the programme recovery, a major technology supplier proposed a mainframe-to-cloud migration, positioned as cost reduction. The investment would have been the largest regional IT commitment in the group’s history.
The Real Problem (Not the Stated One)
The Proposal
A supplier-promoted mainframe migration, framed as modernization and cost reduction. Required significant, multi-year capital commitment.
My Findings
Cost allocation models were non-standardized. After benchmarking, the mainframe was among the most cost-efficient platforms in the group. Four mission-critical tools had been omitted from the migration analysis.
Key Interventions
- Independent economic analysis: Benchmarked cost structures across group entities, exposing flawed assumptions.
- Escalation to corporate finance: Elevated the decision from IT to finance, reframing as capital allocation.
- Knowledge preservation: Rebuilt critical documentation before senior engineer retirements.
Measured Outcomes
Averted a high-risk, zero-value migration. Preserved a cost-efficient, stable platform. Strengthened executive confidence in capital allocation discipline.
Why This Case Is Reusable
Any organization receiving vendor-promoted capital expenditure proposals should ask: “Has anyone independently validated the economics?” The pattern is pervasive across industries.
If this resembles your situation, I'm available for a confidential conversation.
eric.de.morgoli@proton.me or View engagement criteria