Buying Computers: Minimizing Your Capital Investment by Greg Welsh We know that business today requires substantial information technology investments. And we have learned that the real cost is not the hardware or the software, but the “human capital” that goes into setting up, running, and maintaining the technology necessary to your business goals. Whether it’s your time, your employees’, or the contractor you’ve engaged to maintain your IT infrastructure, these “soft costs” are substantial and far outweigh the capital investment in hardware, software, networking and communications technologies and services. One way to minimize your cash outlay – or to free up cash to pay for the people you need to help you run an effective and efficient operation – is to avoid buying new, and looking into refurbished computers. Companies such as Dell offer the same warranty options and service guarantees on factory-rebuilt units as they do on new computers, so the only real risk is ego and bragging rights. But instead of saying you have the latest brand-new whatchamacallit (and then trying to prove you know how to get the most out of that expenditure), you can say how much you saved in the refurbished market and have money to put toward making the best use of your latest tools. The Harvard Business Review recently ran an article arguing that information technology is beyond its boom stage, and that in the future it will be nothing more than a commodity input, undeserving of the glamour, prestige, and anything-goes perks of the boom years when the rapid growth of the Internet lit up the globe like a Christmas tree, millions and billions of servers and nodes and web pages twinkling everywhere. They’ve got it both right and wrong. The real story is in the content, the collaboration, the work being accomplished – knowledge acquisition and knowledge management – for which increasingly sophisticated technology investments are required. So the less money you put into the “stuff” and the more cash you preserve to pay your knowledge workers, the better off you’ll be. Buying refurbished doesn’t mean you can stint on the specifications – but it does mean that you can get more for less. If you’re buying workstations for your employees, don’t skimp on memory or disk space; you’ll just slow down their work and pay over and over again in waiting time while they watch the hourglass. If you’re buying a server (or servers), make sure you check out the hardware requirements and recommendations from the vendors providing the core applications. Running Windows2000 Server with Small Business 2000 and Exchange 2000? Get adequately sized dual hard drives for mirroring (or step up another notch and put in a RAID array to bulletproof your data) and be more than generous with server memory – at least 1 Gigabyte or more, depending on the number of users and the applications you’re running. This sounds daunting, but Dell and other vendors will provide sales consultation to help you size your systems, and your own IT staff or service providers can audit and verify the vendors’ recommendations. And remember the total costs as you think about drive capacity, memory, or peripherals - incremental capacity is always inexpensive at the time of purchase and much more costly when it’s an upgrade. The cost difference between a hard drive of one size and a larger size will be nominal at the time of purchase when compared with what you’ll spend to buy, install, and configure a second, larger drive a year or so later. What kind of service and support can you expect from the vendor after the sale? No less than if you’d bought the system brand-new. Service contracts are offered worldwide on a variety of terms; find one that fits your budget and your risk profile, and then put it on your list. Return to top of page - Return to homepage