Managing expenses is key to a successful business. To do that, you need to understand the actual Total Cost of Ownership (TCO) of your investment. Making your financial decision on purchase price alone is a losing strategy, and this is especially true when deciding what technology and computer equipment to purchase.
Consider the duration and detailed services provided. Most consumer PCs only come with a limited one-year warranty. PCs should be expected to last three years for business use and should have a warranty that matches.
The default warranty on most PCs requires that you pack up the unit and ship it back for repair. This means someone you don’t know has access to the data on your system and your business is without a computer. With some mail-in repairs taking two to four weeks, these are large concerns.
Instead, an ideal warranty on a business PC should provide next day, on-site repair. Downtime, shipping, and any repair costs are important factors to consider when calculating your TCO.
If you are buying a PC from an online retailer or local electronics store, you can expect it to come loaded with “bloatware”. This is the industry term for pre-installed software and apps that your business does not need. Their existence on your computer can slow it down and make you more susceptible to viruses and malware.
Additionally, those PCs will not have all the software tools specific to your business installed. This means you either must take up your own time getting the computer ready for business or pay an IT provider a steep hourly rate to complete the configuration. These expenses should also be considered in your TCO.
security and backup
Don’t forget other monthly services that are critical to safe PC operations. Those include a proper subscription for antivirus, malware, and data backup. Skipping out on those services to save a few more bucks could lead to a catastrophic business loss. Finalize your TCO by adding in the cost of monthly subscription services for security and backup.
Calculating the TCO for a PC purchase can take time and might be overwhelming. That makes it seem much easier to buy the hot deal of the month PC and take your chances. As a business leader, you know you need to make sound financial decisions and you also have to allocate your time to priority business tasks.
Surprises aren’t something that should be accepted when it comes to making good financial decisions. Overpaying for your business’s technology can severely impact your bottom line and limit your ability to invest your profit in growing your business.
Use this guide to calculate expenses related to technology ownership you might be forgetting about. Before you make technology purchases, compare the TCO of your current situation and that of the proposed purchase.
but wait, there's more
There is a lot more to consider before making technology investments. Watch for future blogs on the difference between consumer-class and business-class equipment, what a warranty should cover, unlimited vs. hourly support, and more. We would love to know what else you want to learn about. Please share your ideas through the "Ask Me" survey on this page.
At my first ‘real’ job in Information Technology (IT) I worked within a team of people assembling, configuring, and shipping large computer orders for companies like Abbott Laboratories. Orders were piling up and customers were waiting weeks to receive their new computers. I knew there had to be a faster way.
I could not stand the thought of customers’ waiting so long to get their orders filled. I proposed instead of each technician working on a small batch of orders, we follow an assembly line approach. In a few days we were cranking out pallets of fully configured computer systems, we eliminated the backlog and most orders were fulfilled the same or next day.
It was a seemingly triumphant moment, until I was called into the manager’s office. I had literally worked myself out of a job. Still, I did not regret doing the right thing for our customers. Luckily, they had another role for me to fill and similarly, it needed some mindful efficiency applied.
I continued my self-led training and successfully gained professional industry certifications in Microsoft Server technologies which led to a job in the IT department at Allstate Insurance Company.
During my nine years at Allstate I continued to apply my passion for customer experience and process efficiency. I continued to push back anytime I felt it could be done better. They were not always keen on my questions, but they humored me. I believed if my team was fully read into the business needs and goals, we could design a better solution at a lower cost. We did, reducing project costs by millions of dollars. I learned to take the time to fully understand the business needs, then design the RIGHT solution.
Training and life lessons came together for me and a light bulb went on. Long before it was a corporate buzz word, I was practicing servant leadership. I found ways to support my employees in their entirety, no more “leaving your baggage at the door” when coming to work. We built a team culture that was genuinely supportive and was not limited to dealing with 9 to 5 issues. That made us a strong team and a force to be reckoned with.
We learned to ask WHY a lot! Unbeknownst to me, this was a revolutionary way to manage IT. I was honestly doing what I thought was right in each situation.
it is the same everywhere
After accepting a role on a newly formed IT operations consulting practice with Microsoft and consulting for over 130 companies in eight different countries, I came to learn just how forward thinking my approach really was.
As I settled into a life of full-time jet setting with Microsoft, I had another illuminating moment. Regardless of geography, size, or industry, businesses tend to suffer from the same types of technology challenges. The issue with solving these challenges in large fortune 500 companies is the time it takes to undo so many years of layer upon layer of problems.
Oh, and the culture. Most fortune 500 companies have not gotten the memo about servant leadership. They spend a lot of time, and a lot of money, talking at each other about who’s problem it is to solve the problem.
The technology was not the prevalent issue across these companies. The issue was a lack of consistency, misalignment of solutions to needs, and complexity for the sake of “that’s the way we have always done it”.
maybe smaller is better
I departed Microsoft and took a role with a much smaller IT company that served small business customers. I wanted to know if the same issues were at play in companies without the layers of bureaucracy, without 100 years of built up denial, and without the multi-million dollar technology budgets.
The answer is yes, the same problems exist, and no one was solving these issues for them. I found the average small business IT service provider was gleefully intent to sell their customers anything and everything. Sometimes ten of them, just for good measure.
Instead of helping meet business needs, these IT providers were adding to the complexity, driving inconsistency, feeding into the misalignment. Not one to sit by and watch a problem grow without a solution, I left after a year.
doing the right thing
It was time to take my twenty years of insight and experience and so something impactful with it.
Working with two business partners, Leeward Business Advisors was created. We laid out a five-year business plan, filed our articles of incorporation, put $500 in our new business checking account, and started knocking on doors.
six years later
Our team meets with executives and owners, learns about their business, identifies their needs, helps them prioritize, and provides value-aligned solutions. Sometimes the solution is to reduce technology, manage it differently, and improve their process.
We have found a way to create a complete package of IT services that is consistent, without complexity, and readily aligned to most business needs. The result is Leeward Elite.
Leeward Elite is more than a product or service. It is the culmination of over 25 years of experience and insights, it is delighted employees that serve with a passion, it is the right solution without complexity, it is an outstanding experience that delivers great value, and fits comfortably into a small business budget.
Twenty-five years ago, I stood back and looked at a backlog of computer shipments, envisioned an array of disappointed customers, and instinctively modernized the process to solve the problem. Today, our team oversees thousands of computer systems, dozens of processes, and hundreds of requests a day all with the aim of solving the problem and delighting our customers.
In the future, I will cover the importance of business-class vs. consumer-class hardware, servant leadership, cybersecurity, what small businesses need to know when considering their technology needs and more. The goal of this blog is not to convince you to purchase Leeward Elite. It is to share information and help you grow your business!
Of course we are always happy to discuss whether or not Leeward Elite is the right tool for you and invite you to reach out if you would like to learn more about our services.
You can dive deeper into Leeward Elite on our website: LeewardElite.com.
Blogs are posted every other week.
Michael Polzin is the CEO of Leeward Business Advisors and founder of Leeward Elite.