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Total Cost of Ownership TCO: Does it measure up to helping you manage a tighter organization in thes

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Title: Total Cost of Ownership TCO: Does it measure up to helping you manage a tighter organization in thes


1
Total Cost of Ownership (TCO) Does it measure
up to helping you manage a tighter organization
in these tight times?
2
Thanks to these Gold Level Sponsors
Thanks to these Silver Level Sponsors
3
Established in 1981, Accretive Solutions is a
national professional services firm providing
non-attest accounting, tax, finance and corporate
governance services with a staff of over 1,100
experienced professionals.
Accounting Finance
Enterprise Governance
Business Technology
  • Project Management
  • Finance Accounting Support
  • System conversion and integration
  • Due Diligence Analysis
  • Litigation Support
  • Year End Support
  • Start Up Services
  • Mergers Acquisition Integration
  • Project Management
  • Internal Audit Services
  • Business Risk Compliance Services
  • Technology Risk Management Services
  • Information Technology Audit
  • Quality Assessment Reviews
  • Fraud Forensic Reviews
  • Audit Committee Advisory
  • Solutions Delivery
  • Project Program Management
  • Business Process Improvement
  • IT Strategy
  • Solutions Delivery
  • Enterprise Systems
  • Organization Human Performance
  • Interim IT Management
  • Instructional Design Training
  • Merger Acquisition and Divesture Services
  • IT Quality Management

4
"Large firm expertise, midsize firm value, small
firm responsiveness"
  • Tax planning and controversy
  • Business litigation
  • Construction law
  • Corporate, securities finance
  • Commercial real estate
  • Estate planning

5
Since opening our door 20 years ago, our goal has
been simple to make sure our clients feel
secure and confident about their financial
future To help achieve this goal, HB focuses on
three areas
Team Approach to Client Service Tactical and
Customized Asset Allocation Comprehensive
Financial Planning
The result over 500 high-net-worth
relationships and counting
6
Focused on the Client
Focused on the Client
www.t-u.com
7
Thanks to these Silver Level Sponsors
8
Total Cost of Ownership (TCO) Does it measure
up to helping you manage a tighter organization
in these tight times?
9
The Panel
  • John Carpentier
  • Shareholder, Tarpley Underwood
  • Bill Geist
  • EVP Customer Services, CDC Software
  • Om Kundu
  • First Vice President, Suntrust
  • Jeff Pyden
  • Founder/Managing Director, OmniVue
  • Don Campbell Moderator
  • President/CEO, Virtual Management Technologies

10
  • What is TCO?
  • TCO is a financial estimate that helps executives
    determine direct and indirect costs of a product
    or system.
  • TCO relates to an enterprises asset and/or
    related systems total costs across all projects
    and processes.
  • The total profitability picture.
  • Other calculation examples
  • Return on Investment
  • Internal rate of return
  • Economic value added

11
  • Computer and Software
  • Operations Expenses
  • Network hardware and software
  • Server hardware and software
  • Workstation hardware and software
  • Installation and integration of hardware and
    software
  • Purchasing research
  • Warranties and licenses
  • License tracking - compliance
  • Other migration expenses
  • Infrastructure (floor space)
  • Electricity
  • Insurance
  • Testing costs
  • Downtime, outage expenses
  • Diminished performance (i.e. users productivity)
  • Security
  • Backup and recovery process
  • Technology training

12

Operations and Maintenance
End-of-Life Management
Procurement
Total Cost of Ownership
13
  • Gartner Example
  • Cost of Desktop PC - 1,200
  • 4-year Cost of same PC - 5,867
  • Cost of notebook computer - 1,500
  • 3-year cost - 29,700 (9,900/year)
  • Issues theft, damage, loss

14

Total Cost of PC Ownership, 2008 Gartner Group
15
Total Cost of Notebook Ownership by Travelling
Workers (Gartner, 2008)
16
General TCO Cost Breakdown
  • Common IT Ratios
  • Capital Costs 21
  • Technical Support 21
  • Administration Costs 13
  • End User Support 45

17
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18
  • Like any tool, TCO modeling does have
    limitations. For example
  • Although very likely to reduce long-term costs,
    TCO modeling itself may initially add cost by
    asking procurement decision makers to gather and
    consider more information.
  • Since TCO modeling tracks long-term, life-cycle
    costs, capturing the benefits of TCO analysis in
    a single years budget can be difficult.
  • TCO modeling does not assess risk or how well a
    particular technology fits with an organizations
    strategic goals or needs.
  • TCO modeling does not necessarily track
    environmental or social costs and benefits.

Federal Government
19
  • VMT Lean IT Calculator

20
  • Topics for Discussion
  • Apply TCO to greater corporate planning effort
  • Is it a valuable metric?
  • How does it relate to changing economic
    landscape?
  • What software tools are available to make TCO
    easier?

21
The Panel
  • John Carpentier
  • Shareholder, Tarpley Underwood
  • Bill Geist
  • EVP Customer Services, CDC Software
  • Om Kundu
  • First Vice President, Suntrust
  • Jeff Pyden
  • Founder/Managing Director, OmniVue
  • Don Campbell Moderator
  • President/CEO, Virtual Management Technologies
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