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  • What is your purchasing mentality/strategy?

    I only have about 4 year experience under my belt in IT and have never had any training in management or planning (a few books I've read touched briefly on the subject) I'm in a job position where I should probably know more about this.

    Rick, your post here got me thinking about this and I was wondering if you wouldn't mind expanding a little bit on what you said. I can see how buying only what you need might have possibly saved our company money and time.

    e.g. The company I work for bought a phone system 3 years ago with ease of expanding to a new location in mind. Well now we're looking to expand to a new location but our system may not work as well as we hoped and were promised. So now we're looking at buying more equipment than we planned for.

    I would love to get others input on this subject as well.
    Do you generally agree with Rick? (Sorry Rick, don't mean to put you on the spot)
    Any other methods used?
    Any good articles or books?
    Regards,
    Jeremy

    Network Consultant/Engineer
    Baltimore - Washington area and beyond
    www.gma-cpa.com

  • #2
    Re: What is your purchasing mentality/strategy?

    This "could" be an interesting thread depending on the user community. Much of what we're talking about here is the business side of IT which is dramatically different from the techie side. I'd be more than happy to work up some scenarios, anecdotal as they may be, from past lives in IT that illustrate Total Cost of Ownership (TCO) and some of the Cost-Benefit Analysis issues associated with the procurement process. Realize every case is different and much depends on how your organization values IT and capital expenditures.
    Cheers,

    Rick

    ** Remember to give credit where credit is due and leave reputation points sigpic where appropriate **

    2006-2099 R Valstar. This post is offered "as is" for discussion purposes only with no express or implied warranty of any kind including, but not limited to, correctness or fitness for use. Nothing herein shall be construed as advice. Attempting any activity based on information in this post is done at your own risk.

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    • #3
      Re: What is your purchasing mentality/strategy?

      Well I'd love to hear what you have to say but it seems that other aren't interested... or maybe it's just a bad title.
      Regards,
      Jeremy

      Network Consultant/Engineer
      Baltimore - Washington area and beyond
      www.gma-cpa.com

      Comment


      • #4
        Re: What is your purchasing mentality/strategy?

        I don't buy. I'm only on the side of supporting and advising :P
        Marcel
        Technical Consultant
        Netherlands
        http://www.phetios.com
        http://blog.nessus.nl

        MCITP(EA, SA), MCSA/E 2003:Security, CCNA, SNAF, DCUCI, CCSA/E/E+ (R60), VCP4/5, NCDA, NCIE - SAN, NCIE - BR, EMCPE
        "No matter how secure, there is always the human factor."

        "Enjoy life today, tomorrow may never come."
        "If you're going through hell, keep going. ~Winston Churchill"

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        • #5
          Re: What is your purchasing mentality/strategy?

          Have you considered VoIP for your phone system. A lot of them now have VoIP add on modules. You do need good switches. A lot of schools are using them here in OZ. However I have seen one problem where when a Ghost session was started it brought the phone system to it's knees.

          As for hardware stratagies. The Govt policy is to lease PCs. Every 3 years out with the old, in with the new.
          1 1 was a racehorse.
          2 2 was 1 2.
          1 1 1 1 race 1 day,
          2 2 1 1 2

          Comment


          • #6
            Re: What is your purchasing mentality/strategy?

            Originally posted by biggles77 View Post
            Have you considered VoIP for your phone system. A lot of them now have VoIP add on modules. You do need good switches. A lot of schools are using them here in OZ. However I have seen one problem where when a Ghost session was started it brought the phone system to it's knees.
            Oh we got VoIP (3com NBX). The problem is we were given the impression/told that we could connect two offices using a VPN over the Internet. Well this is technically true but the voice quality drops dramatically. So now we're looking to get a point to point T1 or Frame Relay connection. Anything that will allow us to prioritize the VoIP traffic (like our switches do)
            As for hardware stratagies. The Govt policy is to lease PCs. Every 3 years out with the old, in with the new.
            That would be nice but the owner won't lease anything. The only thing that he leases is the office building.
            Regards,
            Jeremy

            Network Consultant/Engineer
            Baltimore - Washington area and beyond
            www.gma-cpa.com

            Comment


            • #7
              Re: What is your purchasing mentality/strategy?

              Well there is a project for you. Do a study on the cost of leasing compared to purchasing. You will need to speak to an accountant to see what sort of tax offsets there may be as it will obviously be different to OZ.
              1 1 was a racehorse.
              2 2 was 1 2.
              1 1 1 1 race 1 day,
              2 2 1 1 2

              Comment


              • #8
                Re: What is your purchasing mentality/strategy?

                Given PC prices and interest rates in the USA, I'm betting an outright purchase w/ either a Section 179 deduction or a 3 year straight line depreciation followed by donating the machines after 3 years to a local school will be cheaper than leasing.

                For smaller operations, the TCO is often most affected by dragging out procurement over time such that every machine is different. Support costs then become a much bigger factor.

                Another problem we've all experienced is top-down machine recycling. New machine comes in, the Boss gets it. Boss' machine goes to next in command, and so on. That can tank the TCO.
                Cheers,

                Rick

                ** Remember to give credit where credit is due and leave reputation points sigpic where appropriate **

                2006-2099 R Valstar. This post is offered "as is" for discussion purposes only with no express or implied warranty of any kind including, but not limited to, correctness or fitness for use. Nothing herein shall be construed as advice. Attempting any activity based on information in this post is done at your own risk.

                Comment


                • #9
                  Re: What is your purchasing mentality/strategy?

                  Originally posted by rvalstar View Post
                  For smaller operations, the TCO is often most affected by dragging out procurement over time such that every machine is different. Support costs then become a much bigger factor.
                  Have you been looking into the processes here
                  Yes, I've experienced this.
                  Sometimes it's me that's the holdup (most times not though) because a quick purchase process means I need to be knowledgeable about what we're purchasing beforehand. Of course a way to do it would be to use a consultant and we do from time to time.


                  Another problem we've all experienced is top-down machine recycling. New machine comes in, the Boss gets it. Boss' machine goes to next in command, and so on. That can tank the TCO.
                  Another practice here but to a lesser extent since I was put in charge. (I didn't like the idea of machine recycling, seems like more effort than it was worth)

                  Unfortunately we are on no equipment cycle of any kind. Everything is "as needed".

                  Like Chris said, it looks like I have a project ahead of me.
                  Regards,
                  Jeremy

                  Network Consultant/Engineer
                  Baltimore - Washington area and beyond
                  www.gma-cpa.com

                  Comment


                  • #10
                    Re: What is your purchasing mentality/strategy?

                    Originally posted by JeremyW View Post
                    Oh we got VoIP (3com NBX). The problem is we were given the impression/told that we could connect two offices using a VPN over the Internet. Well this is technically true but the voice quality drops dramatically..
                    Yes true ! Anytime even if you try Cisco VoIP solution. I dont no rules and regulations at United States Of America's govt telephone company.

                    Usually according to govt rules we, here can only establish VoIP connection between our branch offices only, no matter they are within the country or spreaded around the world. Making phone calls outside our branch is illegal.
                    You may go through ISP's rules and regulation page. They usually give it to you.

                    You can contact ISP who can provided dedicated line for your VoIP. Where there will only voice traffic. And it costs around not more than half US $ per call . I dont no the exact real time scenario but 2 weeks ago ago i attended Cisco's "Global Leap" event where some ISP's explained about this entire scenario and how it works.

                    So i think buying separate 512 kbps or 1 MBPS bandwidth will be cost saving, more comfotable solution as it's gonna be the solution for the corporate . You can may also discuss @ Cisco Pro Tech forum. There are many VoIP profesionals who can help you in few minute's.

                    Regards,
                    Amey Abhyankar.
                    All in 1
                    Solaris,Linux & Windows admin + networking.

                    Comment


                    • #11
                      Re: What is your purchasing mentality/strategy?

                      Hmm, it seems that my phone system is taking a prominate place in this thread...

                      Thanks for the input, Amey. That's amazing that it cost over 1/2 just to make a call. We have a couple of flat rate PRIs and I think it averages out to be about .01 - .03 per call. I could be wrong about the numbers and of course it would depend on how many calls we make.
                      Regards,
                      Jeremy

                      Network Consultant/Engineer
                      Baltimore - Washington area and beyond
                      www.gma-cpa.com

                      Comment


                      • #12
                        Re: What is your purchasing mentality/strategy?

                        Yes, it looks like asset management isn't going to play well on a tech site.

                        Looks like we scratched the surface on workstations. Shared assets critical to business operations like servers, your phone switch, etc. are much more interesting.

                        Oh well.
                        Cheers,

                        Rick

                        ** Remember to give credit where credit is due and leave reputation points sigpic where appropriate **

                        2006-2099 R Valstar. This post is offered "as is" for discussion purposes only with no express or implied warranty of any kind including, but not limited to, correctness or fitness for use. Nothing herein shall be construed as advice. Attempting any activity based on information in this post is done at your own risk.

                        Comment


                        • #13
                          Re: What is your purchasing mentality/strategy?

                          Hi, Jeremy.
                          Are you still interested in the hardware's part of your initial question? Or the telephony issue is the relevant one?
                          I can say a word or two about servers and workstation, less about networking and telephony.
                          I don't want to disturb the dust when not needed, so let me know

                          Sorin Solomon


                          In order to succeed, your desire for success should be greater than your fear of failure.
                          -

                          Comment


                          • #14
                            Re: What is your purchasing mentality/strategy?

                            Originally posted by sorinso View Post
                            Hi, Jeremy.
                            Are you still interested in the hardware's part of your initial question? Or the telephony issue is the relevant one?
                            I can say a word or two about servers and workstation, less about networking and telephony.
                            I don't want to disturb the dust when not needed, so let me know
                            Indeed I would!

                            But let me say before you respond that I wasn't looking for what hardware to buy or advice on the phone system (meant just to be an example) but rather what is your plan of attack when you find yourself needing to increase/upgrade/replace your hardware/software/SP. What are the factors you consider in such a situation?

                            Thanks.
                            Regards,
                            Jeremy

                            Network Consultant/Engineer
                            Baltimore - Washington area and beyond
                            www.gma-cpa.com

                            Comment


                            • #15
                              Re: What is your purchasing mentality/strategy?

                              Don't worry, I wasn't going to sell anything
                              I've noticed that your intentions were more towards the philosophy behind the purchasing process and planning, than what equipment is better than the other. This is the reason I popped the question again.
                              First things first: I am involved in computers since the end of the 80s in the previous century. I never ever managed to upgrade a computer or server more than to add memory or disks. Not motherboard, not CPU, nothing major. I remember that back in the XT days, I bought my first computer with a MB that supported the newest technology. Payed almost twice the price, but I wanted to be ready for the upgrade. I was very disappointed when I upgraded the computer to a brand new model, that did not existed in the first place (already after two years).
                              All this to say one plain thing: major upgrades never work. They have some chances if you are tight with the money, have an opportunity... But in 99% of the cases, when you need to upgrade, is better to get a new machine. Especially nowadays, when the life cycle of a technology is measured in months.
                              Our policy (my luck that the big boss thinks like me) is to replace servers that finish their warranty period. After three years, a server is replaced. Period. It turned out that prolonging its warranty (have to do it, as most machines are production) will take almost a third from the price of a new machine (in some cases, even more than a third). Meaning, that in three years, I spent the cost of a new machine (as for the time I had to replace it) and I'm stuck with old technology.
                              Yes, it's a pain in the ass. Yes, it costs a lot. But this is the way it should be done.
                              It's not the same for workstations. As long as it works, the workstation is in use. I still have 5 years old HP Vectras running. They run XP, as public workstations, only with browser, without Office or something heavy. But it does the job.
                              For personnel, we seldom upgrade the memory. The machines are replaced by the oldest first, without considering who's higher in rank. We had some people trying to ask questions and we made the things very clear: the oldest machine goes, replaced by a new one. In 6 months will be old anyhow
                              So, to put things together: whenever I plan to buy a new toy, I only see that minor upgrades will be available: memory and disks. If I get a 2GB machine, it will be with 2x1GB chips, and not 4x512MB, even if I have 6 slots in the HP380G4 machine. Just to be certain I can add if the need will arise. I have a machine that came with 4GB: 2x1+4x512 . I'm stuck, I need to upgrade its memory, and it will cost me more than it should. I bought it for someone else and didn't check it. I should have, not rely on anyone else.
                              Same goes for disks. If you need 150GB, what will be better: 3x72GB in RAID5 or 2x146 in RAID1? Interesting, isn't it? Depends on what you plan to do next

                              I hope it helped a bit.
                              Last edited by sorinso; 8th January 2007, 22:34. Reason: tipos... sorry...

                              Sorin Solomon


                              In order to succeed, your desire for success should be greater than your fear of failure.
                              -

                              Comment

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