We should have heard or learnt from companies who have invested heavily on sophisticated IT assets (such as business ERP applications, general office applications and even latest hardware) with the aim of improving productivity and increasing profitability. Some of us may also experience how these invested IT assets have drove up support costs. So, should we still refresh our investment on IT assets every 3 years' to 5 years'?
There is really no benchmark on how much or when or what IT assets to invest by companies. However, it is always paramount to ensure our IT assets are relevant to meet the increasing business needs. Here are some proven tips on how we can increase our ROI (return-on-investment) on invested IT assets.
• Establish IT Asset Database
A simple database can track the purchase and use of all corporate software and hardware. For more sophisticated database, it may also generate reports with updated specifications, warranty information and user information. You will have thorough information of assets used by every user and will facilitate faster response to their IT support needs.
• Maintain Service History
This provides a trail of support activities on the use of all hardware or software used within the company. You will then be able to identify failure patterns or incompatibility issues and take timely corrective actions. With this history, you will also be able to identify training gaps and justify for replacement of problematic hardware or software. It is a best practice to encourage your users to submit written requests via email or record requests using a shared spreadsheet so that you can track the resolutions and response to these requests.
• Standardize Applications Used
By standardizing the list of applications and versions used, you will be able to achieve economies-of-scale when finding resolutions on common technical issues. With standardization, there is also minimal incompatibility issues and greater flexibility of recycling the licenses of these applications.
• Maintain Valid Maintenance Contracts
Most companies do not renew maintenance contracts with third-party vendors after first-year of support. In fact, for mission-critical applications, you should maintain valid support service plans at all times. Whenever you turn to these vendors for support, you will improve your knowledge on these applications and become more efficient with it. It is possible that your maintenance costs on these applications will be reduced over time but you should still maintain minimal contacts with the vendors to ensure constant product updates or application trainings to your new users.
• Avoid Heavy Customization
It is always not practical and cost-effective to insist customizing applications to fit 100% of your operational needs. The long-term investment to maintain highly customized applications will always be greater than an application purchased off-the-shelf, which may fulfill only 70% of your operational needs. For heavily customized application, you will also be over-reliant on the third-party vendor and you may face the risk of using the application without any support service plans in the medium-term. This means you will be left with an obsolete application without any possible upgrades to support your future business needs. The general rule of thumb is to invest in an off-the-shelf application which can serve 60% of your operational needs and you may consider customizing not more than 20% of the original application logic.
• Automate Manual Processes
Encourage your users to establish discussion groups to brainstorm ways of automating manual processes thus eliminating tedious and repetitive processes. This will make them constantly thinking of improvements thus increasing overall productivity. Do ensure there is documentation for any automated tasks and define periodic review sessions to verify its effectiveness.
• Delegate Accountability
It is always easy to purchase and deploy an application for business use. However, it is always tough to maintain its relevance to the ever-changing business needs. An approach to maintain relevance and ensure ROI for the application is to delegate accountability to key users. The key users are responsible to ensure data are always kept up to date, to oversee enhancements to the application which can improve productivity and maintain confidentiality of the company's data assets.
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