Slow, old technology has a damaging impact on a company’s competitiveness. And while it seems that the devices themselves are mainly to blame, that’s only a small part of the story.
Devices themselves only account for 20% of the Total Cost of Ownership (TCO) of business IT. The remaining 80% is taken up by all the processes that surround those devices, like acquisition, use, management and renewal.
It’s these related costs that make it expensive for companies to purchase and manage their IT devices themselves. But from our 20 years of experience helping companies move towards a leasing model that optimises device management, we’ve found that it’s possible to make savings as high as 30%.
How are these savings possible?
Let’s take each area in turn:
Licensing typically accounts for around 20% of TCO, but firms often have more devices than they really need, which means they’re paying out for extra licences unnecessarily. Cut the device count and you cut the licence count, which cuts the licence costs.
Recurring problems with outdated devices take up another 20% and are the main source of lost working time, as well as draining IT support resources. Computers that are slow to boot up and programmes that run slowly are often the cause, but installing updates isn’t always a solution. When devices get too old, there’s no easy fix without replacing them.
A further 10% of the TCO lies within management during use, where automated processes could free up huge amounts of time for employees to devote to core business needs. For example, the 3 Step IT service model includes the creation and maintenance of a device register database, an automated invoicing process and training, all of which contribute to TCO savings.
The service model also generates time and cost savings through support services, which covers another 20% of TCO. Reports are automatically generated instead of manually compiled, while environmental certificates are included when devices are acquired, removing the financial burden of getting the certification separately.
Implementation and pre-assembly only accounts for about 5% of TCO. However, being able to acquire new devices that are already set up and can be utilised by businesses represents a major efficiency at the start of lifecycles. Similarly, at the end of lifecycles, the 5% of TCO that covers return and disposal can be streamlined through pick-up services that cover recycling, secure data wiping and security certification.
And let’s not forget that last 20% of TCO connected to acquisition of the devices themselves. Tendering, smarter device choices, flexible leasing and financing solutions can all generate financial efficiencies compared to owning devices outright.
So how much can you save in your business?
Every business is different, and some will benefit from savings in certain areas more than others. But as the points above demonstrate, moving towards a smart leasing model has the potential to drastically lower your IT costs.
* The calculator is based on evaluations which use the following information sources:
SYSmark™ 2014 evaluation criteria by BAPCo® group. Measures the capacity of Windows® platforms.
Battery endurance (in minutes) measured with the Tears of Steel® program. 1080p, 23.976fps, H.264, 3000kbps, rev1.mp4 >/=200nit, DPST=ON, normal screen brightness, balanced, using Wi-Fi.
Graphic capacity evaluated by using 3DMark 1.2.0 Cloud Gate in testing DX 10 graphics. Read more from www.futuremark.com.
Techaisle®, evaluation of consequences of aging PCs.
