Short-term savings that can lead to long-term IT costs

Technology is often presented as a way to cut operational spending—after all, if you can get a machine to do the work of 10 employees, you’re definitely going to see some savings. However, when it comes to IT services and infrastructure, choose your savings carefully. Low-overhead IT solutions may cost less upfront, but opting for these services can come back to haunt you during an IT support or security event.

Most organisations spend very little on IT solutions as it is—small businesses dedicate an average 6.9% of their budget to IT, while enterprise companies spend a mere 3.1%. Considering how much a data breach or server downtime can cost you ($3.62 million and $100,000 per hour, respectively), choosing economy-grade equipment and IT support isn’t always the wisest choice.

An easy analogy comes from the grocery store. Sure, a two-pack of paper towels costs less upfront than a pack of 24, but when you really break it down, you’re spending a lot more per roll than you would if you bought the bulk package—and it’s not like you’re going to run out of uses for paper towels!

Similarly, businesses may shave IT spending by opting for limited services packages, but this often backfires spectacularly when there’s a need for more intensive, personalised support. If your server goes down or you can’t access mission-critical data, you might end up paying through the nose for hourly IT support. Here are some of the techniques businesses use to save on IT services and solutions, as well as why those strategies often boomerang when the heat is on.

Refurbished equipment: Is it worth the long-term costs?

The best computers and devices are as reliable as the dawn: They won’t conk out on you in the middle of a huge report or suddenly go down during your busiest day of the year. However, top-of-the-line equipment is expensive, especially if it’s brand-new.

That said, refurbished computers, server machines and other devices present an opportunity for cash-strapped businesses to save. You can often find refurbished laptops and desktops on sale for hundreds of dollars below retail price—but what you save in money, you lose in easy IT support, longevity and coverage.

Keep in mind that return policies for refurbished products are usually fairly limited. Under Apple’s return window, for instance, you have just two weeks to identify defects and send back the product. And Apple actually has one of the more lenient refurbished equipment policies out there!

If you choose to go down the refurbishment path, you’ll also face restrictions on your warranty. Most refurbished products are only under warranty for 30 to 90 days, and in some cases, the warranty may not even be applicable if the manufacturer doesn’t have a repair centre in your area.

Lastly, used equipment may need to be replaced or repaired more frequently, even though it’s been refurbished. This issue tends to particularly crop up with used laptops, which have older batteries that require charging more often and may even need to be replaced altogether. A malfunctioning hard drive is another common problem, and you’ll have to pay out of pocket to have it replaced. Even if you don’t experience problems with worn-out parts, older equipment obviously becomes outdated sooner than brand-new models. The question becomes: Do you want to save now or save later?

Break/fix and hourly IT structures: Will they cover your IT needs?

Sure, investing in refurbished equipment is a gamble, but it’s a low-stakes bet compared to opting for limited IT support. Break/fix and hourly IT support structures exist for businesses that have very minimal IT commitments—under this model, your business is charged only when you call IT support. Unlike with managed services providers (MSPs), which can provide you with 24/7 monitoring and other ongoing services, you won’t pay a fixed fee for IT services with the hourly model.

Break/fix models typically cost less, so they may appear to be saving your business money. The problem is that these pricing structures make IT spending unpredictable and difficult to budget. Additionally, hourly providers offer largely ad hoc IT solutions, so there’s little due diligence to ensure the overall security of your infrastructure and systems.

Break/fix and hourly IT solutions may do for the short-term, but there’s not much preventative work done to head off problems down the line. Furthermore, you won’t have the planning and strategic advice of an expert. All in all, think of your IT support choices as being equivalent to seeing the dentist: You’re probably a lot better off going every six months for a cleaning than only when you have a cavity.

Skimping on IT security: A bad idea by any measure

If it ain’t broke… you know the rest. Maybe that mantra works for the government, but in terms of IT services, legacy applications aren’t all they’re cracked up to be. Older software often introduces security vulnerabilities into your network, and because these flaws may not be discovered until after an application’s release, the set-it-and-forget-it method of technology management isn’t a very successful policy.

Moreover, it’s important to reconsider your business security any time you add a network component. Even if you have robust data intrusion detection, firewalls and other IT solutions, you could be putting yourself in a vulnerable position if your wireless devices don’t all follow security best practices. There’s also the issue of data security with outside vendors—your information (and your clients’ sensitive data) could be at risk if those vendors aren’t using proper encryption, access management and other data protections.

This is where MSPs excel by evaluating your network as a whole entity, auditing for security weaknesses in applications, devices and infrastructure. They can also provide user training to knock out security issues resulting from human error and will work with outside vendors to ensure your data stays protected even when it’s not stored on your own servers or networks.

Call Us
Email Us