Total Cost of Ownership

[Face-Man]

My Boss has asked me to do a presentation to SMT about TCO. I have a Basic idea but would like any advice anybody has. I wouldn't mind working out how much it costs to allow USB keys becuse they think it is just £15

[Dos_Box]

TCO is a business buzzword and was used almost soley as a method of selling new hardware to companies by producing lots of lovely figures to justify the expense of the new equipment. You can create and jucggle the figures as you wish and make them say what you want them too. In short, TCO is a marketing tool and if your SMT have latched onto it then more fool them.

[Ric_]

TCO measure the amount of money it costs to own/run/manage an item over its lifespan - say 3 years. For example, a printer may cost £400 and you replace the toner every 3 months at a cost of £70. However, another printer may cost £200 but the toners run out after 2 months and cost £80 each. Printer 2 has a higher TCO. This is before taking into account your time to change toners and clean the printer.

As for USB keys, you will need to try to decide how many hours it will take to configure your environment to take them (securely) - 10 sounds like a nice round number - and then factor in on going time for when the malicious little brats invade your network with crap - 3 hours a week. If you get paid £1 an hour and can buy a USB drive for £2 then £15 sounds fair! :P

[Ric_]

@Dos_Box: TCO is very important in education too! A low TCO means that running costs and administrative overhead are low. Low running costs mean more money to spend on shiny new things and low administrative overheads mean less firefighting! :P

[russdev]

i have got somewhere tot excel tool i will dig it out

russ

[Dos_Box]

You can still manipulate the figures as you want though!

[russdev]

of course but it provides evidence if fileld in correct and truthly provides head with figures to say here is what is required to keep running for next 3 years

russ

[mark]

Do they want to spend more money or less? If you think they'd be amenable you could put together a replacement plan for all your expenditures.

[Pear]

Surely the time you wasted spent on working out TCO's could be better used. Obviously you want to compare the price of products and reusable items like toners, but taking into consideration man hours is pointless as its a totally random and unpredictable number. You can roughly say how many toners a year you will need but to come up with an accurate number on how often you will spend fixing the printer is bizarre ! Especially when you haven't even bought it yet.

[Netman]

TCO is an extremely important tool in Network Management. In order to accurately decide on any purchase you need to do some sort of cost-benefit analysis, even if this is only in your head... and to be able to correctly do that, you need to know the total cost of an item, not just the up-front or purchase cost, which never reveals the true picture. The major problem in the past with many schools is that they'll just buy equipment and never see the ongoing and associated costs of it - hence we have under-paid, sometimes under-qualified ICT staff in so many schools. If the projects to deploy ICT in schools had been done properly in the first place, there really wouldn't so many problems now. I bet _Rics TCO has decreased dramatically with a thin client architecture... and no doubt that argument was part of how he sold the idea to senior management. More info in the attached pdf... but definately a subject every NM should be aware of, and know how to use.... IMHO

[Pear]

Well, I suppose that is a point, I could make good use of it to SMT. Ric is right to have the thin client network as it makes so much sense. But I'd still stand by what I said if someone was coming to me with a TCO analysis.

[russdev]

at moment cant accees gmail where file is as soon as embc soprt issue with gmail out will post it

russ

[Face-Man]

Thanks for all this it is really useful. The whole issue came up when the cheapest I was quoted was £30 to get rid of our old GX110 systems. With the EU regulations about environmental disposal of electronic equipment throwing them away was not an option. I got around this by "giving" them to staff but SMT got concerned about the cost of my time to do that ! After pointing out that a computer is not just for christmas and that maintaining old kit cost money they have asked for a TOC in order to plan ICT spending more effectivly. I think the lights have finally come on re ICT spending so I want to do it right so that our current Technican ratio of 1 to 160 can be reduced and the world can be a better place.... To quote " I love it when a plan comes together". :twisted:

[andy]

TCO is a business buzzword and was used almost soley as a method of selling new hardware to companies by producing lots of lovely figures to justify the expense of the new equipment. You can create and jucggle the figures as you wish and make them say what you want them too. In short, TCO is a marketing tool and if your SMT have latched onto it then more fool them.

If I was cynical I would suggest using the figures to get them to agree to buying the kit you want!

Andy.

[Face-Man]

I will be obviously asking for what is required but based on the premise you only ever get 50% of what you ask for. But it is more fundamental than that they (SMT) really have no idea that when you buy a PC it is not just the £300-800 price that has to be considered. It's the cabling infrastructure, switch capacity, server capacity, maintenace cost, support time and finally disposal cost. so the budget needs to be maintaned high year on year to keep things running not 100k one year 20k next. After all we all know the member of staff that requires a full time technician all to themselves :x

Just found the spreedsheet mentioned earlier (cheers russdev)

http://www.lgfl.net/lgfl/accounts/co...20oct%2005.xls

let me know if you want it posted here