Signs of invigorated business spending in 2014 are evident in double-digit CapEx growth predictions by leading global asset managers. Many IT managers, having seen budgets frozen since the 2008 recession, are also experiencing anxiety stemming from having underspent on technology and communications since the recession and desperately need to leapfrog a generation of technology.
For some businesses, the decision of what to take on themselves and when to tap outside resources to help can prove perplexing.
While it may seem unusual to see a topic related to upgrades on a services-related blog, there is a tremendous downside to sweating assets incorrectly, and a services organization is often left to help pick up the pieces when things go wrong. In some cases, sweating assets can be a savvy financial strategy, but it can also backfire.
Generally, any technology solution that is more than 8 years old will likely be in some level of “extended support, ” which only provides ‘best effort’ services if something goes down. Bug fixes are usually no longer being developed for these old solutions.
Parts are likely being sourced from the gray market, leading to quality issues and long acquisition times. On average, these “new” old parts are up to 4 times more likely to be dead on arrival. The next stop on the support lifecycle is end of support, which only increases exposure to risk.
According to IDC, downtime costs for mid-size businesses can average $70,000 per hour. If the part that you need is available in Australia, how many hours of downtime are you going to be forced to endure? What would 3 or 4 days of downtime do to customer satisfaction?
What if this downtime happened during a busy season? What would happen to the IT department if it was forced to do an unplanned, hasty upgrade? Is the asset sweating worth the costs to customers, partners and employees? The benefits of sweating assets need to be very carefully weighed against the business risks of letting a technology solution age.
How do you make the best decision at this inflection point? Many IT leaders leverage new money to make revolutionary, versus evolutionary changes. Traditional upgrade paths normally lead to an on-premise, CapEx-based solution, but today’s cloud-based options might be the best path forward.
Many early cloud initiatives were tactical in nature, as businesses tested the water on new technology consumption models. But cloud solutions have now advanced to the point that they can provide the communications foundation for IT organizations to shift from being producers of technology to consumers of it.
Also providing a support option for IT managers are managed services companies that can handle legacy systems while enabling the Business IT organization to invest resources in next generation technology and consumption models that provide rapid access to the latest application benefits.
Applications are transforming how organizations deploy and capitalize on technology. While this innovation can help boost business growth and improve efficiency, new solutions can further burden IT organizations that are already being compelled to handle growing service demand with shrinking staff resources.
New applications may also require skill sets beyond those of existing staff. This imbalance between requirements and resources can prompt organizations to explore staff augmentation options beyond the typical “manage my switch” arrangements.
With companies waking up from the thaw and deciding how to minimize the issues associated with sweating legacy systems and catching up to new apps and technologies in the market, there has never been a more critical time to consider getting expert advice to help define a business IT roadmap.
Are you seeing a thaw in budgets?
Who do you rely on guidance to help define your roadmap?
What are your biggest concerns given your 2014 investment goals?
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