For those of you with any knowledge of Hardware Lifecycle Management practices, you likely understand that to reduce TCO, extend the useful life of and contain OpEx budgets, you need to ensure that:
“Educate them. But don’t OVER-educate them,” that was a former boss’s direction before pitching my former company’s solution to a client. He was afraid that if a prospect truly understood the economics of Cisco third party maintenance (“TPM”), they would choose to do it themselves rather than buying maintenance from us. My goal today is to “OVER-educate” you by opening the kimono on the economics of the industry.
Traditional OEM service level agreements are not meeting the rapid and changing needs of most businesses. In a recent Forrester study, over 70 percent of IT managers acknowledge being attracted to third-party maintenance arrangements because of exorbitant OEM pricing and contract entitlement issues. But, despite the growing shift away from traditional OEM service level agreements, many companies still remain leery of third party service contracts for three reasons.
In the not so far distant past the world was roaring, and “rolling in the dough” so to speak; and third party IT maintenance was not very high up on the food chain. But lately, there hasn’t been as much “dough rolling,” and many organizations are turning to 3rd party IT maintenance to accommodate severe budget constraints and reductions in capital expenditures. Companies have been forced to retain equipment for longer periods of time, and organizations are doing more with less. What they are finding out is with third-party IT maintenance they can actually limit their service expenditures without compromising uptime or performance.
The October 2012 report on Oversight in IT spending from the GAO was recently discussed in an article by Jack Moore. The GAO slammed many agencies for failing to provide reporting on how they spent billions on IT functions. Clearly many agencies simply ignored Congressional reporting mandates, which make IT management at the top level nearly impossible.
If you’re connected to what’s going on in the world at all you’ve probably heard there is a hurricane brewing just off the coast of Florida and headed straight for the Republican National Convention! Well, maybe. As I was watching the news last night, listening to the latest updates and predictions of where tropical storm Isaac was headed, my own thoughts likewise started brewing. An idea began to formulate about how similar IT network maintenance and hurricanes really are!
If it wasn't common knowledge before that Cisco and other big OEMs force customers into buying new equipment before ready or corner them into OEM maintenance contracts, it may be now. The Wall Street Journal posted the following yesterday June 26, 2012 bringing to the attention of the public just what big OEM's like Cisco are trying to do...
If you haven’t heard of it yet and you’re in computer networking, it’s likely that you will soon. Software-defined networking (SDN) is taking the industry by storm and promising to change the way computer networks are managed in the future. It’s refashioning the data center and creating an onset of start-ups that are forcing old-guard vendors like Cisco and Juniper to scurry to keep up.