First, he said the savings
almost certainly less than the cost of the waste. This sounds like a guess. He gives no numbers, and doesn't appear to have quantified anything.
Second, maybe IT was running so smoothly previously because it was bloated, and was a huge drain on company resources. Maybe it was running smoothly because a bad manager refused to put a limit on anything, leading to a division whos costs were completely out of control.
We have no idea, because there are no details in the article about the company, or about the IT spending before OR after the cuts.