Total Cost of Ownership

Posts Tagged ‘Total Cost of Ownership’

Cutting ICT Costs

Monday, October 10th, 2011

Quite understandably at this present time, there appear to be plenty of thought and initiatives going around as to how to reduce the cost of ICT provision in schools.

I am not surprised by this but I am concerned by it.

I am concerned that it is the perceived need to cut costs that is driving current thinking and, to my mind, this can be a dangerous route to take. Education is not a business, it is not an industry; for us, the bottom line is not our profit or our costs. A school will not be judged or praised on its ability to cut its costs, it will be judged and praised (or criticised) on the performance and attainment of its learners.

There is a very careful path that needs to be trod between cutting costs and maintaining/improving the performance of learners in a school.

It seems to my mind that rather than setting out simply to cut costs, schools need first to establish control of their costs. For this, I would recommend schools look at Becta’s investment planner tool, which I believe is still available online. This tool is not a full TCO (Total Cost of Ownership) tool but it was derived from Becta’s original TCO model. The original TCO tool was more encompassing in seeking to identify costs more accurately and relate them to usage and performance. There is not time or space to detail TCO fully in this article but I would be more than happy to talk to any school wishing to explore a fuller TCO in order to better understand and control its ICT costs.

With the improved knowledge and understanding that TCO brings, a school can identify which costs it can control and any that it cannot. The school is then better positioned not only to identify cost-savings but also to anticipate the effects of such measures. A classic example of cost saving comes from a school believing, rightly so, that it can reduce its costs by cutting back on printing, particularly inks and paper costs. While a school can make savings in this area, a full TCO generally reveals that this is only a very small cost and any reduction is almost insignificant.

Not only can current costs be revealed by TCO but a school will be better placed to explore potential costs/savings for future provision, even to the point of being able to compare different options for continuing or replacing software, hardware and services.

While it has to be acknowledged that there is pressure upon schools and headteachers to reduce costs, particularly of their ICT, I would maintain that it is important first for schools to resist the temptation to make cost cuts without first gaining a better understanding and control that could be brought about by TCO.