While computer equipment disposal may be the focus of your company now, the optimal strategy for reducing the Total Cost of Ownership (TCO) of your IT infrastructure is through an effective life cycle management strategy that involves:
It has been reported that the cost of hardware represents only 20% of the total cost of ownership of the equipment (Gartner Group, 2003). Other factors related to the management, service, support and retirement of IT equipment represent the bulk of the costs to an organization.
It's best to focus early in the IT procurement and disposal planning process to investigate opportunities to improve the productive use and reduce the undesired costs related to IT asset management.
Focusing on Asset Retirement: Opportunities to Increasing ROI
Research on industry approaches to IT asset retirement concludes that simple changes in how old electronics are managed at organizations can provide a true economic benefit to the company. The Aberdeen Group reports that any organization removing as few as 3,000 PCs can save as much as $1 million per year in unnecessary storage and disposal costs by implementing an effective asset disposition program. (Aberdeen, 2003). Additionally, the report cited the fact that if stored IT equipment has any resale or recycling value, it depreciates between 6% and 10% per month. Some cost savings strategies focus on improvements in the following areas:
- Handling of assets
- Logistics costs
- Reporting costs
- Property tax liabilities
- Data removal
- Recycling/Disposal costs
- Donation program administration
- Employee sale administration
- After sale support
- Revenue from the sale of assets
- Environmental liability protection
- Management of outsource partner
It's best to consider all of these issues when embarking on developing a new IT Asset Retirement program.