Updating and Managing Your Technology: A Primer

Disposing of Old Tech

Old PCs don't die, and they don't fade away, either. The average PC will run almost forever, and the harmful chemicals inside it will survive in your local landfill for even longer. How many long-lived-but-obsolete computers is your company moving around among staffers? There's definitely a point of diminishing returns in holding on to PCs past their prime, as well as hidden costs in just about any disposal method you choose. Recycling, selling them to employees or giving them to charity are all viable options, but they all have costs attached--many of which may surprise you. It's a good idea to have an exit strategy for your old hardware--and it should be in place long before the intrinsic value of your PCs hits zero.

Complete depreciation is often here before you know it, but there's good news in that respect: The average middle-of-the-road PC now has a useful life of about three years; a high-end desktop, about four years. But be careful: Nurse an old PC along for too long, and productivity suffers--for low-level staffers as well as managers. Worker efficiency declines along with equipment efficiency, so when software takes longer to load, screens take longer to redraw and incompatibilities start to occur, memory upgrades need to be deployed. Most old PCs have years of utility left in them--just not for you. There are tons of schools, community groups, senior homes and other needy institutions that would be happy to take them off your hands. Unfortunately, donation is another of the more costly disposal options. By the time you get done with moving, temporarily storing, shipping, tax record-keeping, making contractual arrangements with the beneficiary, possible testing and repair, and, of course, facing the ever-present legal exposure, IDC figures it will cost you $344 for each PC donated.

And the legal exposure is real. You could get sued for donating a defective or virus-infected computer, or you may be asked to defend the tax deduction. On the upside, the infrastructure for charitable donations is well-advanced, making this option less time-consuming.

One popular option for PC disposal is selling them. IDC says your net out-of-pocket per PC is $272 if you can sell it to an employee for $100, and $119 if you sell it to a third-party broker for $200. (Remember, costs vary among disposal options and you'll still need to scrub the machines of company information.) The good news is, the PC is gone. But in both cases, you have to sell the PC before its value reaches zero. And those three years for a mid-range PC and four years for a high-end box go by quickly. Of course, brands vary. You can look up the residual value of your PC in the Orion Computer Blue Book. You can purchase the latest version of the Blue Book with the most recent prices from the Orion Research website. You also can look up prices for individual PCs online at $3.99 per shot.

In general, a lot of PC disposal costs are realized in soft dollars, and a certain amount of those are fixed. IDC says it will cost companies at least $150 for every PC taken out of service. First, there's the labor involved in physically removing a system and its network components, disconnecting peripherals and scrubbing the hard drive of software, passwords and sensitive company files. Then there's the downtime for employees during the move. After that, your costs will vary depending on how you choose to dispose of the old PC and may include payment for things like testing and repair or, in many cases, contractual or other legal costs.

And don't even think about tossing them in the trash. Old PCs have chlorinated and brominated substances, Poly Chlorinated Biphenyls (PCBs) and Poly Vinyl Chloride (PVC), heavy metals, gases, acids and plastic additives--and that's just for starters. All those chemicals have incredibly long half-lives. You want your new house sitting on top of this stuff? Not to mention, the EPA will be all over you if you're discovered throwing PCs in the trash.

Training
Buying new technology is usually just the beginning. If employees aren't trained on how to use the new equipment, your business won't get the full benefit of your investment. You can get employees trained in almost any technology, at any level and any subject. Even highly experienced users may need training to use the latest programming and networking tools.

Start your search for training by quizzing the company that sold you the technology. Many vendors have on-staff professional trainers who can come to your site to train employees on using new technologies. If not, they can probably refer you to a local firm that offers appropriate training. You can also look in the business Yellow Pages under "Training Programs" and "Training Consultants." You can choose from various types of training: Classroom training with a live instructor can be done at your business or off-site, in the form of a short tutorial or continuing series of classroom lessons. Having an instructor on hand helps learners get questions answered.

If you can do without a live teacher, check out video-based training. Class starts when you insert a pre-recorded tape or DVD into a VCR or DVD player. Students take notes and follow along in workbooks, just like with live teachers. Video courses can be repeated any time and are low in cost. Computerized training can be delivered in a classroom with PCs, or via the web. Internet classes let students choose the time, place and pace of learning. Some are taught by an instructor who communicates over the internet. Students can mix, mingle and discuss lessons in online chat rooms.

Managing Your Technology Costs
Many business owners today tend to set their tech budgets without having done adequate research--and therefore have unrealistic expectations about how much technology really costs. In fact, many businesses don't have a good understanding of the total cost of ownership of their technology. When making decisions about technology budgets, businesses should focus less on the technology itself and make decisions about how technology complements other areas of the business. Figure out what you need to do to run your business better, and then go find the tools to support it.

Steps you can take to lower technology cost include timely purchases, clever negotiation and internal controls can help businesses save megabucks. You can renegotiate existing contracts for services such as network support and consulting. Telecom is especially ripe for bargains. You can start by setting bench marks for rates and auditing bills to ensure you're not overpaying. And instead of buying all long-distance, local phone and other telecom services from one vendor, dual-source it.

You should also make sure you need whatever new technology you do buy. Inventory all PCs, printers and software. Look for opportunities to consolidate purchases, standardize configurations and root out duplication. Set up a system to keep doing it. Pick a team of people from IT and other departments, and meet with them regularly to discuss what they need and how to save on it.

Another way to save money on tech purchases is buying refurbished hardware. Many online manufacturers and retailers have sections of their websites devoted to clearance outlets. You may have to poke around the site to find them, but it's worth checking into when you're on a tight budget. Refurbished items are usually returns that have been looked over and checked for functionality. As with auctions, check to see if all documentation and software is included. Compare prices to what is normally charged to see if the savings is worthwhile. Often warranties are shortened. What might have originally come with a one-year warranty may only include a 90-day warranty when it's sold as refurbished. If you're comfortable with that, go ahead and save some money.

Looking online for deals is also a great way to save money on your tech budget. And bargain hunting over the Internet doesn't have to be time-consuming. Web sites such as PriceGrabber.com, PriceSCAN.comand MySimon.comare hubs for price comparisons. They're especially handy if you already know what you want and are just looking for the lowest price. Don't be blinded by what seem to be incredible bargains. Always check into an online retailer's reputation if you're not already familiar with it. You probably know this already, but always use a credit card for your purchases in case you have to dispute charges later.

Another great resource for hardware is eBay. You can pick up a wide array of products--from extra cell phone batteries to monitors and ink cartridges--at prices that would make some retailers blush. But eBay is no utopia. You still have to check into the seller's reputation. Also check to see if the product you're buying is refurbished, if it comes with an original warranty or tech support, and if all documentation and pieces are included. Some entrepreneurs may decide that the savings are worth living without some or all of those things. It's not good or bad, it's just a matter of deciding what you feel comfortable with.

If you're the type of person who likes to "handle the merchandise" before you buy, find a local retailer you can visit in person. Prices may be a little higher when you just walk into a store, but you also have the security of having a physical location to return the product to in case of a problem. The Sunday ads are a good place to compare prices, and you should keep an eye out for specials and rebates at your local stores.

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