Like a growing number of businesses worldwide, Tasty Baking is facing a data explosion. The use of e-mail and rich media applications plus the need to stay on top of regulatory compliance are stretching storage resources to the limit at a time when budgets are shrinking. Handling rapidly spiraling storage needs without spending tons of money is a challenge that's facing just about all IT managers. O'Malley crystallizes the need into a single phrase: "More space for the money."

To get a handle on storage demands, IT managers need to carefully examine internal storage practices, use specialized software tools and find appropriate storage systems for various kinds of data. Andrew Reichman, an analyst at Forrester Research Inc., says that they must look first at the two best ways of cutting storage costs. "One is using more-dense drives, and the other is reducing your footprint," he says.

Footprint reduction is relatively easy, says Reichman, asking, "Can you use the Delete key?" But David Hill, founder of The Mesabi Group, a storage management consultancy in Westwood, Mass., notes that many businesses, particularly those in regulated industries, are scared stiff of deleting anything other than spam. "There are a lot of legal reasons, tax reasons," he says. "You have to be careful about how you go about getting rid of data."

Fixed vs. Fluid

Although managers may be reluctant to flush files, they can and cost savings to their storage processes by organizing data more efficiently. Hill recommends separating fixed content -- e-mails, boilerplate documents and other rarely modified files -- from active archives that contain more fluid types of data, such as transactional data.