A guide to assessing hardware technology needs for business
Time for the dreaded IT upgrade? Growing Business sheds some light on finding the right deal for your business
Choosing the right IT equipment, from the right source, at the right price can boost competitiveness and provide capacity for growth. Growing Business presents some tips to help you choose the best deal. Upgrading office hardware has always been essential to running a competitive business, but with the demanding software and operating systems that are prevalent today, it is more important than ever.
There are all kinds of things to consider, from processor speeds to memory and hard drive space – and that’s just PCs. Cut corners and you risk having machines that are slow and unresponsive, unhappy staff and your competitiveness undermined.
Getting the right deal
The lifetime of hardware varies. You can expect desktop PCs and servers to last around three years, and laptops a little less. But when the time comes to update your IT infrastructure, how do you ensure you get the right deal for your business?
“It’s very tough to get the balance between equipment that will last and the cheaper options when you’re a start-up or growing business,” says Jay Bregman, chief technology officer and co-founder of delivery company eCourier.
When companies launch, they usually buy one computer at a time. But this can be an expensive way of going about things.
“Of course, you get better deals if you buy five or 10 at a time, but we had no idea how the business was going to grow, so hiring or buying computers was tricky,” says Bregman.
Within the first three years of a company’s inception, it is likely that you will need to think about upgrading various assets within your technology portfolio. This array of equipment includes everything from PCs to laptops, servers, printers, photocopiers, scanners and fax machines. The good news is that there is a wide range of equipment on the market, including multi-function devices (MFDs), which can perform various tasks, take up less office space and are cheaper than buying a number of standalone devices.
One or many functions?
MFDs have attracted varying responses. eCourier’s Bregman voices a popular one. “We have tended to find that they are a jack of all trades and master of none,” he says. Phil Jones, sales and marketing director at Brother, disagrees. “That opinion is five years out of date, and a commonly held misconception,” he refutes. This is a sentiment echoed by Matt Marshall, programme director of imaging hardware devices at IT analyst house IDC. “MFDs are more than capable of performing the same functions at an equal or even higher standard than standalone devices,” he says.
The data backs him up. Research conducted by IDC found that in 2007, 3.5 million A4 inkjet MFDs were sold, compared with 1.3 million A4 standalone inkjet printers.
But this equipment doesn’t come cheap. Some of the top-of-the-range MFD products will set you back up to £1,000, and for cash-sensitive firms that can be daunting. However, help is at hand. The vendors have developed various leasing schemes. At Brother, you can lease a colour laser printer from £69.99 a month depending on how many pages you will be printing.
Alternatively, you can enlist the services of a technology finance specialist. This method allows you to enter into an agreement that can give you the benefits of using a particular asset or piece of equipment for an agreed period or time, and cost.
Also, don’t forget that leasing deals can have tax implications. These should be cleared with your tax adviser before proceeding with any agreement.
Invest for the future
Philip White, chief executive of IT finance company Syscap, says that upgrading your technology portfolio is vital in a competitive business environment. “The IT you invest in today may not have sufficient capacity for a growing business of tomorrow,” he says. The ability to finance technology through leasing can make upgrades affordable, and also gives business leaders the chance to take a best-of-breed approach rather than making all of your purchases from one vendor. “As hardware has become increasingly commoditised, vendors have become better in certain arenas,” says White.
Bregman agrees that this kind of approach has been beneficial for his business and says that there have been unforeseen additional benefits, including the fact that it gives you a bargaining tool with suppliers. Dell gets eCourier’s desktop PC business while its servers are sourced from elsewhere. As a result, says Bregman, Dell is constantly pitching for the company’s server business.
When it comes to desktop PCs, most companies opt to aggregate them all over to one supplier. However, when making purchases it is really important to think carefully about what different employees’ requirements are. For example, does a salesperson need the same amount of RAM or disk space as a marketing employee?
With desktop machines, it’s important that computers continue to run quickly and efficiently as applications and software are upgraded. “As new versions of software and applications have come out, performance has slowed dramatically,” says Bregman.
Syscap’s White agrees: “Many IT investments are driven by the product roadmaps of Microsoft or Intel – you need a newer PC to run the new software or operating system.”
Upgrading your IT can be a minefield. It is important to ensure that at all points you are considering the needs of your business and not letting the software behemoths decide your IT upgrade strategy. Whether you chose to hire, lease or buy new equipment, all approaches have their advantages and disadvantages, and it is important to make the choice that fits your business. Sometimes, there really is no room for a one-size-fits-all approach.
Hardware and your carbon footprint
For those small and medium-sized companies that appreciate their environmental impact, 60% are still unaware of specific regulations that apply to their industry. This is largely due to a lack of clear governmental guidelines, according to Philip White of Syscap. “While there is increasing government pressure for business to deal with the green issue, there is insufficient information readily available,” he says.
One area where growing businesses can make easy cuts in their carbon footprint is in the selection and maintenance of office hardware. Most products from recognised brands – HP, Dell, Brother, Epsom and OKI to name a few – are of Energy Star standard. The Energy Star logo means that the energy consumption of an appliance is below an agreed level in ‘stand-by’ mode, saving energy. Over the past few years the Energy Star logo has become increasingly prevalent and rarely adds to equipment cost.
The most recent government legislation to affect businesses is the Waste Electrical and Electronic Equipment (WEEE) Directive, which came into force last July. It means that manufacturers, importers and retailers of electronic and electrical goods are obliged to put systems in place that allow customers to recycle their obsolete devices free of charge.
In Gordon Brown’s final Budget in 2007, the chancellor introduced a number of measures to help businesses striving to operate in a more environmentally friendly manner. These include a tax credit for losses resulting from capital expenditure on energy-saving and water-efficient technologies.
The chancellor also made it more attractive for companies to purchase energy-efficient technology by offering accelerated tax relief by way of a 100% first-year allowance for investment in approved technologies and equipment.
With the exception of the WEEE Directive, this is all voluntary, although an increasingly hardened regulatory framework is bound to follow in the next couple of years. In the meantime, rolling out energy-efficient hardware is one way to reduce both your energy bills and your carbon footprint.