It is a curious fact of life that most businesses probably hold more detailed information about the company car fleet than they do about the organisation’s PC network. Yet while the cars are merely responsible for getting everyone to work in the first place, it is the PCs which are supposed to be the real engine room of success.
Management consultancy KPMG first sounded the alarm bells about this particular PC problem back in the early 90s. Its 1992 Workstation Management Network report calculated that the total cost of workstation ownership is some #5914 per annum. Of this, only a tiny fraction represents the initial purchase price – less than 10% according to KPMG’s figures.
Over 90% of the cost of a desktop device comes from associated support issues. These include known items, such as paying for appropriate training courses and maintenance contracts. KPMG’s research found that a huge amount of support costs are largely unquantified and not actively managed. Since the survey covered companies with an average of 844 machines each, some of the UK’s biggest companies were guilty of failing to monitor where most of their money went.
Among the costs which tended to get overlooked, KPMG included time spent on hardware and software evaluation, the efforts needed to develop an appropriate security and legal compliance programme, and research on equipment upgrades. All of these are essential activities if the organisation is to make best use of its PC resource, yet very few consciously allocated a budget for this.
In addition, KPMG identified a critical figure found in almost all companies, dubbed the workstation guru. This is the individual who knows how to get a particular package working, or who has that vital tip on back-up procedures.
While such information is often like gold-dust for colleagues, frequently the guru’s contribution goes unacknowledged by authority – until the company notices that a very expensive professional is spending a lot of time, and hence company money, on some very trivial problems.
Organisations need better information about what machines they have where and how they are being used. This would allow them to minimise training requirements and cut upgrade costs. For example, if everyone uses the same word processing package the company can organise a series of training days to ensure everyone gets the most out of the PC.
Having an inventory of who is using which machine makes it easier to plan future purchases. Maybe it is not necessary to buy extra memory so someone in accounts can run a new program, if a swap can be arranged with a user elsewhere in the company who has a machine with a bigger capacity but smaller application demands.
But four years after KPMG’s report first suggested companies do not have a clue about where the money goes, new research commissioned by Compaq Computers reveals that the situation has not changed much. Benchmark Research questioned 252 IT directors and 250 financial directors about the costs of PC ownership and found that most were still very hazy on the details.
According to this survey, nearly 60% of the financial directors polled estimated total PC lifetime costs to be less than the original purchase price, while 30% did not know. “Figures from the Gartner Group suggest that over five years, 20% of a PC’s costs are the purchase price and 80% are support costs. Over a quarter of our sample thought that support costs were less than 20% of the purchase price, when in fact the figure is 400%,” points out Steve Jackson, Compaq’s senior product manager for desktop.
A third of the organisations did not record details of PC assets, and just noted how many they had in total. Additional information such as the system configuration or the machine’s serial number was simply not available. Part of the reason for this lack of knowledge was the fact that 69% of those surveyed had to carry out PC audits manually, by walking around the company with a clipboard looking at machines and writing down the details. This process could take as long as six days to complete.
But as Jackson points out, much of the necessary data can now be collected automatically via features built into the PCs themselves. By polling all the machines on the company network it is possible to gain an accurate picture of specification and usage. Such information is effectively provided free, while service monitoring products from the likes of McAfee, Symantec, Microsoft and Novell are not especially expensive. The savings, in terms of reduced upgrade costs, can be impressive.
One government site, for instance, recently bought a system which looks at how applications are being used, how much memory they require and how productive they allow end-users to be. The organisation’s users were constantly complaining about slow system performance and plans were underway to spend a six-figure sum on memory upgrade to cure the problem. In fact, the monitoring uncovered poor disk access speed as the real villain of the piece, which could be resolved by re-configuring some systems at minimal cost.
Baseline statistics also showed how 690 of its 1000 PC users could be given double the performance for an outlay of less than #50,000 using a combination of upgrades, swap-outs and configuration changes. Conventional estimates to achieve the same results ran well into six figures.
The problem of managing IT assets has even been given its own acronym by ICL. The supplier’s multivendor service division, ICL Sorbus, has just launched a consultancy service designed to cope with what it terms as SADS (Systems Asset Drain Syndrome). It provides advice to large companies with more than 1000 end users so they can manage their inventory effectively.
Keeping a close eye on who has which PCs in what sort of configuration stands to make everyone happy, reducing the costs of ownership, and as software licensing controls become tougher it is essential if companies are to prove they are staying within the letter of the law.
“The problem is that there is often a disconnect between what is actually happening in the IT department and what the financial director is aware is going on. The financial director still tends to see IT as a big burden and is often not aware of the mechanisms which would allow him to be more proactive and efficient in the way that infrastructure is run. But cost of ownership for 1000 PCs over their lifetime equates to #6m, and you can’t ignore that,” Jackson concluded.
Pat Sweet is a freelance journalist.