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It is important for enterprises to quantifiably document the number of infrastructure changes it goes through simply to upgrade PC operating systems.
More often than not, existing hardware isn't capable of running a new operating system. The result is that firms will have to add RAM, increase hard drive capacity, and possibly replace the entire system. In terms of cost, it will have to pay for the operating system, RAM, hard drive, new computer, and the labour to conduct the initial hardware inventory. Also there is a cost for the labour to install and configure the new components.
Compatibility with operating systems can be a huge issue
Next, a firm may discover that many of its existing software products aren't compatible with the new operating system. As a result it will need to pay for the labour to effectively identify the incompatible products. The company will pay for the labour to attempt work-arounds and probably add the cost of purchasing new products on top of the labor to install them, as well as to re-train personnel in their use. Finally, the chances are the new operating system the company was forced to acquire is no longer compatible with other software legacy products and the cycle will begin again.
On top of this that new operating system is most likely not going to work with all of the existing peripheral components. Suddenly, those legacy printers are no longer communicating in quite the same manner. A firm will then need to pay for technicians to thoroughly check each system as well as purchasing new peripherals and paying technical people to reconfigure systems to match. Firms must also ask how much day-to-day work simply hasn't been completed because technicians have been focused on manipulating the infrastructure for the operating system upgrade. Enterprise technical labor costs could easily double for a six month period surrounding the upgrade, at least until the techs catch up with their regular work load.
IT budgets can be exceeded every year without measures taken
A company can discover that its IT costs tend to significantly exceed the budget in virtually every year the major software industry players choose to come out with that "new and improved" product.
Cost Reduction Options
To minimise the impact of supplier generated budget surges, a few basic strategies can be tried.
- Refuse to purchase new products until the bugs (at least the most glaring ones) have been worked out. Smart enterprises rarely leap on the bandwagon and blindly purchase newly released software products. History has taught them the painful lesson that all-too-many new products are released with a distressing number of less-than-functional capabilities. The costly lesson? Wait about a year after release and let other enterprises pay to work through the majority of the patches and fixes.
- Conduct a thorough - and brutally honest - needs analysis prior to any major technology purchase. If you can't identify a genuine business need for the new tech toy, don't buy it until you can justify the actual costs when matched against the proven benefits. Keep in mind that "because it's new" is not a business need.
- Don't fall for the media hype. The technology industry suppliers have billions to spend on swamping the media with highly persuasive commercial messages convincing enterprises that the next big product release will magically solve every business problem ever encountered. This silver bullet claim somehow never manages to come true.
- A variation of the silver bullet media hype scenario is one we've encountered in way too many enterprises. Do not purchase a new technology product simply because one of your personnel discovered its miracles at a conference, trade show, or (far worse) being used by the passenger in the adjacent airline seat.
In this narrow example, the object in adjusting these processes isn't to eliminate software improvements. Instead, it's to ensure that purchases are made out of business need, not due to outside pressures. Reducing the costs of business technologies isn't difficult. The intelligent application of just a little common sense can take companies a long way toward effective life cycle controls over their entire IT environment.
Alan L. Plastow, MAT, PMP, SAM, TPM, is the founder and CEO of The Institute for Technology Asset Management. The Institute is a global non-profit association of technology asset management professionals providing cost effective, supplier-neutral, and competency-based training, credentials, and technology portfolio management resources to practitioners and enterprises.
