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Video: Five reasons to purchase new hardware during a recession

When the economy takes a dive, new hardware purchases are often delayed indefinitely. However, suspending hardware investments can cost you more in the long run. See why there are times when new hardware purchases shouldn't be delayed - even during a recession.

When business is bad or the economy takes a dive, new hardware purchases are often delayed indefinitely. While this is prudent, even essential, for companies struggling to survive, suspending hardware investments can sometimes prove shortsighted and can actually cost you more in the long run. This episodes of Sanity Savers for IT executives explains why there are times when new hardware purchases shouldn't be delayed - even during a recession.

For those of you who prefer text to video, you can click the "Transcript" link underneath the video or you can read the original article from Erik Eckel that this episode was based on: 10 reasons to purchase new hardware during a recession.

About

Jason Hiner is Editor in Chief of TechRepublic and Long Form Editor of ZDNet. He writes about the people, products, and ideas changing how we live and work in the 21st century. He's co-author of the book, Follow the Geeks.

30 comments
rudolphkings
rudolphkings

Mexican IT Manager point of view... Mexican companies are struggling to survive, swine-human flu outbreak, CEO without HBS MBA, Language, culture, pollution, high cost's of licencing... Think about it...You are, just, another day in paradise...

Deadly Ernest
Deadly Ernest

switch to Linux, it's much cheaper. One business in the next town has switched their thirty four desktops to Linux and use browser based applications off their server. by cutting back on what needs to run on the desktop they've extended the life of their three year old desktops and will save money on hardware and software for their next round of actual hardware replacements in a couple of years' time.

rudolphkings
rudolphkings

SPSS Adobe CS Suite MS Office

Deadly Ernest
Deadly Ernest

Actually, most MS Windows based software will run very well in WINE, Crossover, or a virtual environment. Most businesses do NOT have a business need for Adobe CS Suite, and the majority that do can manage very well with GIMP or some of the Linux based graphics programs. Open Office does everything you can do in MS Office, it even does some things MS Office can't - like native compatibility with early MS Office document forms that MS Office doesn't have. With the number of businesses switching to a cloud computer environment or a thin client environment - both of which have the actual work being done on the server, the desktop needs little more than an extremely basic OS and an Internet browser. A simple Linux system with Firefox does cloud computing work as good (better in my opinion) as a basic MS Windows with MS Internet Explorer. For most businesses the office desktop is used for basic word processing and basic spreadsheet work. all stuff that can be done as easily in Open Office as MS Office, and a hell of a lot cheaper too. And Open Office has a Windows version as well as a Linux version in case you have to stay with Win XP due to an expensive special corporate package.

forbes9000
forbes9000

There are few things that really can take advantage of new hardware that you wouldn't get new hardware for anyway. IE you wouldn't upgrade a PC to vista but rather get it with a new purchase. Is there really anything mainstream out there that a P4 can't do. Really? Most hardware failures are mechanical, meaning hard drives and fans/power supplies. Hard drives should be replaced on a regular schedule agreed. But if you do your purchasing with some forethought, you can have replacements of the most likely to fail components that will fit any server that goes down, increasing the overall lifespan of the pool of servers manyfold. Also and most importantly and without much cost at all you can virtualize all of your servers so if one goes down you can bring it up to run on any other server. Having the forethought to have invested in longer term high ROI assets like storage arrays allow you to postpone unnecessary server upgrades have high availability of data, virtualized servers and even disater recovery without continually feeding the hardware monster.

don
don

If you are in Canada, the total purchase can be written off! It was in the recent federal budget that you can write off computer upgrade expenses 100% for the next year. Part of the "stimulus" package.

Deadly Ernest
Deadly Ernest

You still need to have the money in the bank and not need the cash for other operating activities.

Deadly Ernest
Deadly Ernest

Most hardware is replaced at three or four year intervals due to accounting reasons related to depreciation, while the hardware itself will perform with no major problems for six or seven years. Also, there's no point in changing working hardware if it still runs all suitable software properly and isn't yet breaking down. You also need to be aware that some software won't run on some hardware, and that should be a relevant cost in the calculations too. In a properly designed critical server area it should be virtually impossible for a single server to interfere with the operations for more than a few minutes as all critical operations should be running in a duplicated set up with two or more servers set for automatic cut over. Even if you don't have full redundancy, you should always have a back up server ready to go, even if it is a back up for a couple of the front line servers. When a system starts to have troubles you MUST strongly consider replacing it, but not while it's still humming along, unless it's several years old or more. Now to desktops. Replacement of desktop systems will depend a lot upon your organisation's software in use and where it's going with with concepts such as cloud computing. If you're headed that way and already switched, or switching, to browser based access for critical applications, then you don't need new hardware at the desktop, older hardware capable of running a browser is all you need. Having a few extras set around the offices as swap replacements for faulty ones would help, and that's easily done by getting new gear for the few areas that really need new systems for special applications that aren't accessed via browsers. There are a range of strategies to reduce the replacement costs while not leaving the organisation vulnerable to lots of faults. Of the five reasons listed three of them are predicated on you already having hardware at the end of its physical life and not its accounting life. look to your equipment performance and operating stats before considering it too old, not its date of purchase.

IT IN SUNNY FLA
IT IN SUNNY FLA

finally an answer or comment from someone who understands the issues involved and has some actual experience in equipment. we aren't talking about your home gaming machine here or building a one off diy computer for your office.the life of equipment is much longer than 3/4 years especially if you purchase quality equipment in the first place. i have ibm workstations and servers that have been running 24/7/365 for 6/7 years with no hardware failures.older compaqs were just as reliable. stop upgrading to ms' latest crap os and your equipment will last a long time. just keep a few spares around for the rare break down

Deadly Ernest
Deadly Ernest

But you need to keep in mind what they're used for. I've got a twelve year old Pentium 166 that I run Win 98 SE on just to play my older games, but my main machine is a P4 running Kubuntu as I use it for things that are a bit more processing intensive than the games machine. I also have a sixteen year old 486 around with DOS that serves as a file server for back up file copies. Both old machines do the jobs I've set them to do, but are no good for my graphics manipulation work I do on my main machine. The answer is always horses for course and take you time to select the best horse for the job. A thoroughbred race horse is no good for pulling the Budweiser beer wagon and a Clydesdale is no good at winning the Derby. In computer terms, what you need as a desktop is a totally different package to what you need as a server and different again for what you need at home, something MS has trouble working out. Sadly, many senior IT managers have the same problem.

Deadly Ernest
Deadly Ernest

A couple of points for you: 1. Can you upgrade to two or four gig of RAM to those machines. My son recently bought a second hand dell that came with 1 GB of RAM and it was slow as a drenched week (that's much slower than a wet week), but a cheap upgrade from two half gig chips to two two gig chips, the maximum the GX520 can take, and it now hums along beautifully for him. He moved the on board video RAM to the max and XP still recognises 3.5 gig of RAM to operate with. Such part upgrades may be an option to look at for your situation. This can get you a cheap improvement while you sort out the longer term issues. 2. The standard accounting system for the depreciation / amortisation of non mainframe computers is 3 to 5 years - usually 3 or 4 years for desktops and 4 or 5 years for servers and extra fancy machines for major cad or graphics work. That's according to the international accounting standards, the Australian Accounting standards are 3 to 4 years, and so are the Australian Tax standards. So if your accounting people are using anything else, I'd be asking some questions about what they are using and why. See the things you learn when you're a bean counter manager turned IT tech.

ssampier
ssampier

You are right, of course. Businesses can't be buying new desktops just to have new shiny desktop computers. My point was that desktops are work machines. If your machine is slow you are slowing down your workers. We currently have 5.5 year dell dimensions and I am trying hard to get our machines replaced regularly. Each one is slow and can take several minutes to click on the control panel. This is with Windows XP running on a minimum of 1 GB of RAM, with only AVG antivirus, Skype, and spyware/virus free. We are basically a small business so the desktop and laptop count is less than 10. I am sensing some resistance to change. I am pointing out we should amortize the desktop cost over 4 years. The percentage of the desktop cost per year compared to the average person's wage is roughly 1.25% or less.

Deadly Ernest
Deadly Ernest

I'd be having a much closer look at the systems and the software on them. One place I worked at had this problem on all the system the marketing staff used, after seven months they slowed right down. Funnily, when we re-imaged them with the original image they were as fast as when brand new. A close examination of one system before a re-image showed that the marketing people were constantly loading and removing other software, stuff not approved by the IT unit. The result was the registry was getting bloated and loaded with irrelevant crap. they also had a lot of spyware and other excess garbage on the systems every time we had to work on them. We long ago gave up trying to get them to use the systems as per corporate policy and started charging them for all maintenance work on the systems as it was less hassle. I've 386, 486, Pentium, and Pentium II system that still work as fast today as they did the day they were bought. And most still have the original software on them. Over the years I've made a point of not loading unneeded crap and it works wonders. One local business near me was looking to update all their desktops until I asked the owner why. He was in the middle of switching to a in house cloud computing set up for all his business apps, so why have new systems that do everything when all he needs is a basic machine to run a decent web browser. He ended up replacing two special accounting machines and had all the others cut back to nothing but basic OS and web browser; the performance of the systems went up when all the extra software was removed and he saved a fortune. As I said in my first post, take a good long and hard look at what you are doing and carefully consider what's needed before you take any hardware purchase action. Most systems will work perfectly for five to seven years, so why replace them before they crash? Worried about down time, then buy one or two to have on hand as hot spares, but only replace as they become uneconomical to repair. No one has money to tie up in hardware unless it provides a clear improvement in revenue increase.

ssampier
ssampier

At home I DIY and I love it. Here at work, I buy Dell or whomever underbids them. You're right that hardware can last a long time. However, my experience shows that as computers age they get slower and slower. You can reinstall Windows as much as you like but it's a stopgap measure. Does this make sense to slow down your highly paid sales or administrative staff? You could tell your sales people to drive 45 mph on the freeway to save gas, too. As the author states it is better to refresh the desktops regularly.

The 'G-Man.'
The 'G-Man.'

'stop upgrading to ms' latest crap os and your equipment will last a long time' That zeroed your comment in my book

canewshound
canewshound

It has always worked better for us to wait a year or two before adopting MS software, both OS and Applications. Much less impact on users and training. I do not zero out the original comment.

koby@disklace.com
koby@disklace.com

Better be Healthy Young and Rich rather than miserable. This episode should be reserved for those who had a successful TCO reduction project.

HypnoToad72
HypnoToad72

Might get a Macbook Pro as well. Higher quality components, the integrated monitor rocks, and quite honestly I'm tired of fiddlefarting with the Microsoft operating system (malware, corrupted registry issues, and the other usual plagues that seem to be largely stuck with the MS platform. I've been a tech for 20+ years and Vista sold me on the Mac. Pity, I just bought a new Vista notebook two months ago w/8GB RAM. Pity I can't put OS X on it, but we both know the age of the desktop and DIY is over anyway. Better to have two platforms for maximum marketability anyway...)

The 'G-Man.'
The 'G-Man.'

malware, corrupted registry issues - the way my system has been protected, used and setup I never come across these issues.

mr.ash.chapman
mr.ash.chapman

I saw a refurb HP desktop today selling for less than the sum of the parts as put together by NewEgg. I'd be interested to see a thread about people's justifications for doing it themselves. Is overclocking the primary driver?

Kingbackwards
Kingbackwards

When you get an HP or Dell or whoever third party. They usually include their wonderful software packages that I've never seen anyone use. Ever. And of course all those software packages have to start when you boot your computer, otherwise they'd never get launched. thus the need to give the machine a digital enema. Even if it was a refurb unit, who knows what's on it, and if you're a joe user, you probably don't have anything other than the third party windows disk with their software slipstreamed on it. Unlike most IT Pros who have a spare OEM copy. So if you have to start over, why not start from scratch?

The 'G-Man.'
The 'G-Man.'

that is a justfication for anybody.

Deadly Ernest
Deadly Ernest

My comments re HP and DELL are from experience with their gear. Most computers are on a four year replacement cycle due to the common accounting depreciation schedule. HP and DELL start with some spares but stop replacing them after about three years, anything in the way of parts after that are due to them being available from other sources or they're also used on newer models too. I've a five year old HP laptop, no problem with it at all; except I can't get any RAM upgrades for it as it's not a universal style of chip and HP no longer stock it. The hard drive - I can't get that same model but can get a bigger one that fits in the same space as it's a universal style of drive. In the past I've worked on five or six year old Compaqs, HPs, and Dells that important parts weren't available for from the manufacturer - hard drives, video cards, RAM, etc. In a many cases they were parts from companies I've never heard of and couldn't find a trace of. Several I got working again by replacing the parts with industry standard parts, but that also meant a total trashing of the cut down OS supplied by the manufacturer as the hardware was different to what they provided and it wouldn't accept the drivers for the new stuff. I've reached the point where I refuse to work on HP or Dell laptops and am pessimistic about any desktops over three years of age. What has amazed me about HP and Dell systems sold down here is that the new stuff sold in the shops is usually about a year behind the general industry. When DDR RAM came out, the shop sold Dells didn't have any DDR RAM in them until about twelve months later, the same with all the hardware improvements. It kind of explains why they're cheaper, as buying the old gear will save you money regardless of where you buy it. I now have a large store of outdated hardware simply to be able to get client HPs and Dells working again by replacing parts no longer available from the manufacturer, and some not available from anywhere. Current problem is a new video card for three year old Dell desktop, originally had a built-in graphics (no longer working) and only two low profile PCI slots - how long has PCI-e been out, and this machine made three years ago has PCI slots. No parts available from Dell as they suggest a full motherboard replacement at a cost where I can replace the whole machine with better parts as a plain Jane box. But the customer can't afford that. At least plain Jane's can be gradually upgraded and parts are universal.

Lovs2look
Lovs2look

Not repairable? I have personally repaired over 100 HP machines with HP supplied parts on 3 year old hardware no less, so where are you going? Seagate HDD (with a 5 year warranty) nVidia video and Intel CPU and chip set on board, Broadcom networking, Infineon RAM...what extra cheap parts do you mean? Both companies give at least a 12 month warranty on all their computers...standard practice in the industry, so I'm wondering what your source for this info is? A website in China?

Deadly Ernest
Deadly Ernest

are not repairable because they bought extra cheap short run parts from some unknown hardware manufacturer. Neither company gives parts support for too long either.

The 'G-Man.'
The 'G-Man.'

normally DIY builders choose hight-end parts, an HP machiine will not ship with high end parts.

paul.burden
paul.burden

The man just wrote that a refurb full tower costs less than buying the parts. So price? Not if you're doing a whole system at the same time. I buy parts months apart, when I can afford them and not an upgrade of everything. That way it's easier to fit into a budget and you're not spending it all in a lump sum. That's for home use of course. I would never just upgrade the parts in business use, it's just too time consuming.

Phantom2487
Phantom2487

Only for core and critical hardware, unfortunately management cant connect the dots to see that without client machines working the core and critical hardware are of no use. But we all know that unlike core hardware, client hardware is only a fraction of productivity lost where core = most/all lost. Once again failure of managment to listen to what i have to say equals more client down time and less productivity. Which is typical of over promoted, under experienced, and under educated ppl in mgmt. -T|K

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