What’s important to you? We think it should be the best use and longest life of each dollar spent on IT. It means really evaluating a few facets of each purchase.
Total Cost over Useful Life must Equal Business Value. Yeah, it’s a mouthful, but let’s think about that for a moment. The annual cost must be of business value, in other words, the benefit should be equal to, or preferably greater, than the cost. Here’s how we figure it out.
This must include all costs. Cost of item, tax, shipping and handling. But also important are items like annual maintenance and foreseeable costs outside what is covered. The name of the game has to be to cap your costs, but in doing so, you may overpay. Hardware support is a gamble in two ways. First, you’re betting that the cost of the support is less than a few service calls. Secondly, what is the most important thing to understand about support contracts is that you will always receive more timely response support over those that have no contract. So at this point, you need to figure out what an hour, or a day – or two – of downtime means to your operation. This is really what the hardware maintenance contract hedges against.
Software support must be factored in as well, but before signing up to 15-25% per year of retail cost (not what you paid for it), ask yourself a simple question. Am I going to benefit here? The answer lies in evaluating the situation. If you’re deploying a new ERP system, by ALL means, get the support for the first year to get through it. But once it’s stable and assuming you’re not in need of constant updates tied to a software agreement, that money might be better used for other business purposes. You can always re-up later
Very important here is to be realistic as to useful life. When considering the purchase, ensure you are not under buying to save a thousand dollars, but then your solutions only lasts for three years and you were thinking six years. This short-term savings just cost you a ton of money, and you not only have to repurchase, but pay the cost and endure the pain of redeployment.
If something (like a server or a phone system) is scalable, meaning you can buy what you need today and add to it later without performing a forklift upgrade, that may be another way to pull out a win.
Probably the most important point here about useful life is how a few dollars can hedge an earlier-than-expected retirement of your systems. Thinking down the road a few years and being just short of a clairvoyant will serve you well.
As we have been at this for many years, we know how long stuff lasts – period. We thought we would share our experience here to help you make better and more informed decisions .
AVAYA IP Office – 7 years minimum. Look, there are no moving parts and upgrades are a couple hundred dollars and a few hours, it’s a solid telephony solution.
Cisco VoIp – 5 years maximum. Our experience here in supporting these systems has been that a couple years in, it requires an expensive upgrade to remain compatible with the latest Windows systems on which the Agents reside. A workaround here is to run XP in Virtual Mode. The other reason that life is limited to 5 years is that the servers/hardware they place them on are typically only warrantied for 5 years max.
Exchange Server – 5 to 7 years. Most companies here skip every other version of exchange, so most folks going to Exchange 2010 today are on Exchange 2003. This helps defray deployment costs by ‘skipping’ a deployment cycle. And these days, Dell and soon others will warranty servers for 7 years, as it makes business sense.
Firewalls – 4-5 years. This is typically as long as the manufacturer is comfortable standing behind the product. Also pay attention to “trade-up” programs and try to pre-purchase at least two years of support as it’s cheaper that way.
In the end, it’s all about the best use of strategic IT dollar and how you stretch and leverage your expenditures.
We’ve moved! We now have a 50% larger data center with more rack space, all the bells and whistles, and are able to host more cost- effective solutions like cloud hosting, SBS hosting, web hosting and proactive system monitoring. Also, if you’re moving, we can be your stop-gap for mission-critical applications as we can host your systems as you transition.
Recently, we also have become both a Juniper Networks and Barracuda Networks partner to add to our list of strategic partnerships. The way we see it, if we can deploy the solutions for companies, we don’t need to make as much in the sale of the hardware and software solutions, controlling your total cost of deployment.