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END-TO-END PC LIFECYCLE COST MANAGEMENT

Leveraging Technology and Intellectual Capital to Reduce Costs and Improve Efficiency

Edward A. Bullen The Strategic Enterprise Consulting Group

......................................................................................................................................................................................................................................... 6 FINANCIALS............................................................................................................................ 5 LIFECYCLE OPTIMIZATION ........................................................................................................................................................... 13 BUSINESS CASE SUMMARY .............................................................. 15 APPENDIX A ............................................................................................................................................................................................................................... 7 SUPPLY MODEL .............................................................................................................................................................................................................................................................................................................................................................................................EXECUTIVE SUMMARY ...................................................................................................................................................................... 12 ASSET MANAGEMENT ................................................................................... 12 AUTONOMIC SOLUTION ARCHITECTURE ... 8 INTEGRATED ASSET MANAGEMENT AND SUPPORT SERVICES .......................................................................................................................................................................................................... 16 APPENDIX B .................................................................................................................................................................... 10 “PUSH” DEPLOYMENT STRATEGY ........ 3 PRODUCT LIFECYCLE BEST PRACTICES ASSESSMENT .......................................................................................... 10 STRATEGIC PROCUREMENT .............. 17 2 ............................ 8 BUSINESS CASE ............................................................................................................................................................................................................................ 5 “PUSH” MODEL DEPLOYMENT STRATEGY ..... 6 “BEST PRACTICES” PROCUREMENT AND ASSET MANAGEMENT SYSTEM ..................................................................................................................................... 14 PARTNERSHIP OFFERING .........................................................................

That is. This value proposition includes:  Market leading PC manageability.single-point-of-contact (SPOC). and so forth). Consulting studies have shown that. supply. lead to substantial cost reduction opportunities while enhancing service levels and improving customer satisfaction. comprehensive financing. logistics management.Maintaining or enhancing service levels  Asset Management . warranties  Optimized supply model . Usage optimisation. tax mitigation. and results in high structural cost savings and increased customer satisfaction)  Autonomic Solutions Architecture (Advanced technologies that reduce administrative costs of deployment and management of a PC throughout its lifecycle. These PC lifecycle “best-practices” include:  Strategic procurement (Includes process automation. enterprise-wide asset data repository. and leasing)  “Push” deployment strategy (A strategy for managing rollouts which removes end-users from the procurement process.multiple price-indexing models. Not understanding these costs may lead to poor management decisions. and security)  Enterprise-wide Asset Management (Includes the implementation of an enterprise-wide asset data repository which is linked to the procurement process for asset data capture) SECG proposes a value proposition. that could yield hard cost savings of up to US$250 PC per year.Information architecture development and implementation. procurement. links to other systems  Flexible financials . Application deployment and portfolio management  Services . lifecycle optimization. where many costs are hidden and the complexity of the infrastructure makes support difficult. Linkage elements include: Systems Management (migration. volume procurement. Disposal of end-of-life assets  Risk Mitigation . single sourcing. virtual project office 3 .direct fulfillment. and 3) Risk Mitigation. and higher costs. asset management. LANDesk. the three dominant issues facing CIO's today are 1) Cost management and/or cost reduction. end-to-end project management. based on the technologies and practices mentioned above.models. when deployed in an integrated fashion. contract management. eliminates the concept of order cycle time. There are a number of companies that have developed TCO (total cost of ownership)-related technologies that are designed to reduce the administrative cost for deploying and managing PC’s. Managing obsolescence.Structural cost reduction  Procurement . security. and billing options  Program Management . in addition to the key issues of cost reduction and service level enhancement. This is especially true when implementing PCs in a business environment. manageability.Implementing global standards  Financial . it is important to know all costs associated with owning and managing PC’s (includes laptops) within the enterprise. vendor relationship management. Reducing administrative costs  Technology . Understanding these costs facilitates effective management of the IT infrastructure and enables significant. image management). standardization. global supply priority  “Push” model deployment strategy .e. higher risk. and disposal.automated processes. and Microsoft.managed rollouts.Implementing best practices. deployment. vendor switching costs According to surveys. These issues may include the following:  Strategy . wireless. steady-state support. cost-saving business decisions. 2) Maintaining or improving service levels to end users. including SECG. These issues seem to be in conflict with one another. facilitates rapid deployment. lifecycle optimization  Integrated procurement and asset management system . it would seem to be impossible to improve service levels while reducing costs and without increased risk.Asset tracking. The greatest cost saving opportunities are realized by focusing on lifecycle processes including planning. The Strategic Enterprise Consulting Group (SECG) is also a leader in championing and implementing key end-to-end “best practices” that. In order to successfully address these critical issues. and wireless technologies  Globally integrated products .Sourcing strategies.EXECUTIVE SUMMARY Global corporations face many important IT issues that are impacted by PC cost of ownership. corporations are also increasingly concerned about risks associated with PC-related lifecycle activities (i.

support and solutions capabilities  Global resources  Extensive enterprise experience SECG is committed to helping your company reduce its PC total cost of ownership. and financing.The financial aspects of this value proposition are based on the total estimated worldwide PC volume within your company and assume optimal usage of the proposed combination of technology. SECG’s unique financial models and considerable intellectual capital can be used to help your company build a compelling business case for the implementation of PC lifecycle “best practices” resulting in considerable structural cost savings and improved customer satisfaction. A customer organization should seek out vendors whose strengths include the following:  Differentiated products  Breadth of technology  Market leadership in PC manageability  Extensive service. 4 . The ability to implement “best practices” from an integrated. end-to-end perspective differentiates a company from its competition. services. Independent watch-groups and consultants consistently validate this statement.

problem management overview. “PUSH” MODEL DEPLOYMENT STRATEGY The “push” model deployment strategy is based on the following:  Advanced aggregate planning and forecasting  Procurement automation  Business-driven standards  Single sourcing of supply  Large volume asset refreshes This strategy differs from typical transaction-oriented procurement systems where planning is limited and forecasting is highly inaccurate. 5 . Problem Management Overview Break/fix (maintenance) contracts and processes are analyzed for improvement opportunities. and service level agreement review. Process costs will be quantified (including shadow processes) based on customer-supplied data. As well. asset management assessment. This is because the one-time procurement cost is spread over many machines. the procurement cost per PC is essentially eliminated. This greatly simplifies the procurement process and reduces costs. Security Evaluation An assessment of the existing asset-related security practices is performed and opportunities to improve asset protection are identified. steady-state support.new systems will be deployed within your organization. PC Lifecycle Cost Analysis The SECG Value Proposition includes a comprehensive PC lifecycle cost assessment. therefore. removed from the procurement process altogether. The SECG Value Proposition can best be implemented after we have gained a thorough understanding of the related issues of Lifecycle Management within your organization. Rather.  Identify hidden or shadow processes that might exist  Examine all processes and technologies for process time reduction and service cost reduction opportunities. End-users of a typical company or organization play a major role in a transaction-oriented procurement environment.  Perform an analysis of lifecycle costs. Asset Management Assessment The existing processes and operational activities are evaluated and advice is given on the necessary scope of work for an asset management service implementation to complement the existing organization.PRODUCT LIFECYCLE BEST PRACTICES ASSESSMENT Most PC-related cost issues are not directly technology-related. and asset management processes at your company. including planning. The “push” model involves deployment of standards that are based on business requirements.  Document and validate current processes and practices. when large volumes of PCs are acquired via a “push” approach. Elements of the “assessment” component of the SECG Value Proposition include a PC lifecycle cost assessment. as well as IT advances currently in place. procurement. Service Level Agreements Review Existing Service Level Agreements (SLAs) are reviewed (including related third party SLAs) and recommendations are made for improving service levels via specific asset management services within the Value Proposition. they are related to the operational management of the distributed environment and how the technology is utilized. which results in considerable customization at the user level and drives support costs up.  Develop a road map to guide your company toward “best practices” implementation. physical security evaluation. The prototype will demonstrate and validate projected savings from the lifecycle cost analysis.  Systems Management Tools Validation Prototype . The end-user is. The product mix is determined by job type rather than user preference. Key components of this TCO analysis will include the following:  Identify the key charts of accounts for a PC lifecycle cost assessment. using advanced systems management tools and capabilities. deployment.

and internet/intranet. refer to the Business Case section. configuration. and a dedicated team of people. 6 . and disposal. and in performing brand value comparisons. servers. “BEST PRACTICES” PROCUREMENT AND ASSET MANAGEMENT SYSTEM SECG’s Value Proposition includes the implementation of both web-enabled and client/server-based systems that significantly enhance and automate enterprise processes and operations in both the areas of asset acquisition and asset management. This team performs and manages the acquisition process of distributed computing products while reducing costs. Optimizing the lifecycle. this model is also useful in making single sourcing and lease versus buy decisions. e-mail.  Full and complete invoice reconciliation  Ensuring that data regarding new assets is updated in the asset management repository. break/fix. off-the-shelf software or services which will affect the delivery schedule. help desk. The typical optimum lifecycle for PCs in a networked. These services are supported by integrated applications. The SECG Lifecycle Cost Model is also useful for business case justification of initiatives such as full or partial asset refreshes. SECG’s Acquisition Systems have the following functionality specific to your company:  View company standards for HW/SW configurations of systems and peripherals along with company-specific pricing  Create product requisitions and orders  “Tiered” approval features  Review the status of a pending order  Check status of approved orders  Review estimated ship dates for ordered products Additional benefits of the proposed acquisition system include the following major components:  Order tracking  Order discrepancy resolution  Confirmation of order placement with estimated ship date  Notification of vendor change requests  Processing of your company change order requests  Verification of equipment shipment with supplier  Processing of RMAs (Return Merchandise Authorizations) for incorrect shipments  Coordination of order placement and delivery for approved orders  Notification of any constrained hardware. PCs will be deployed in a “big bang” asset refresh fashion and replaced every three years as prescribed by the optimum lifecycle. streamlining administrative activities and delivering detailed asset information.LIFECYCLE OPTIMIZATION Lifecycle optimization is the determination of the duration of time that a PC should be deployed within an enterprise coupled with an operating discipline that manages process elements of the entire PC lifecycle. PCs will be managed to minimize break/fix charges over and above warranty service levels and to limit the number of hardware upgrades allowed. can result in substantial incremental annual hard cost savings for a typical company. IMAC (installation. and consolidation of end user services such as. SECG’s Value Proposition to your company recommends optimizing the lifecycle of PCs to be deployed in a “push” strategy. corporate environment is three years (For more detailed discussion. below.) Components of the lifecycle cost model include: procurement. by eliminating hardware upgrades and limiting break/fix activity to warranty service only. a substantial item product information catalog. a preferred vendor/manufacturer. global standards development. adds. corporate environment. In addition. SECG’s acquisition services are designed to facilitate the procurement of leased and/or purchased technology assets via electronic linkages to the manufacturer. Facilitate resolution with appropriate vendors. moves. changes). Turning over inventory at the optimal lifecycle point all but eliminates upgrade costs and has a substantial impact on break/fix costs. SECG has developed a Lifecycle Cost Model that has been used to determine the optimum life of PCs when deployed in a networked. During that period. and/or leasing company.

it is important to establish pricing agreements that help guarantee competitive pricing throughout the term of the contract. and cost plus pricing. forecasting and project related initiatives such as technology migrations. SECG offers several price-indexing models including transaction or special bid pricing. FINANCIALS For managed rollouts. A single worldwide master lease agreement. delivery. written in English. Price per Seat financing (hardware and services) is also a potential financial component of SECG’s Value Proposition to your company. and integrates this data into a comprehensive asset management database. while obtaining equally competitive pricing for nonstandard purchases. SECG is uniquely positioned to offer a comprehensive financing solution for your multinational PC financing requirements. One advantage of this agreement is the ability to perform cross-border transfers of PCs within your company. This asset management system is more than a simple repository and provides for advanced decision support to your company or organization management team and administrators.In conjunction with the previously mentioned asset acquisition system. All of the relevant data and events that occur during the asset lifecycle are captured and updated and made accessible via this system. the assets are tracked and managed throughout the entire lifecycle. In addition to maintenance data and history – by serial number – the following major data elements are available via such a system and will enable your company organization to maintain a broad view of their desktop assets:                Hardware Component level detail Acquisition information Installation information User information and location Software version level License compliance Upgrade planning control Standards enforcement Change management Manage lifecycle events Re-deploy assets and components Global change capabilities Warranty/maintenance Warranty terms                 Warranty status Maintenance tracking Warranty/maintenance contact Financial and leasing Present value of lease rentals Gross remaining rentals Depreciation Net book value Charge-backs Manage lease schedules Commencement and termination dates End-user skills Course and skill inventory Course and skill assessments Costs for skills training User profile Your company will have access to more than a large number of data elements relevant to end-users and technology assets and access to more many standard search and report capabilities pertaining to your company enterprise desktop asset environment. Once part of the system. In conjunction with global financing companies. In addition to on-line view of asset records. Your company will receive the best pricing on your company PC hardware standards. advanced asset reporting is available from this system to aid in enterprise management and decision support. this robust client/server system aggregates all relevant asset data at the time of initial acquisition. The reporting function has been determined to significantly enhance enterprise planning. In brief. such as IDC). A PC asset can be moved across country borders without the termination of the lease agreement and the associated termination penalties. and installation. relationship (or fixed discount) pricing. 7 . with offshore financing available in several additional countries where lease financing is not legal. The best technology financing companies provide in-country financing in many countries. provides consistent lease terms and conditions around the world. benchmark pricing (based on third party indices. SECG proposes the implementation of a closely integrated asset management system that enables comprehensive tracking and management of all technology assets within the enterprise.

or directly at the target site. where all platform-certified production software is collected for distribution and version control purposes. The VPO will be structured to provide appropriate and interactive channels for communications. In addition to conventional communication methods. including North America. the vendor will provide a substitute of equal or greater value. the local activities by client or contractor personnel can be coordinated. The fulfillment model for your company will be optimized for a managed rollout. issue reporting and resolution. SUPPLY MODEL SECG assists customers to select a global vendor with significant presence and resources in all geographies. Change (MAC) Management Supported by web-based technology for easy access and coordination of all asset-related changes including physical delivery. using the closest Enterprise Management gateways or local file server. Such vendors provide Global Priority Supply Programs. status reporting. and general project-related discussion. may identify cases where business partners should be used in the fulfillment process in order to deliver the best value to your company. changes). Product will be shipped to your company locations directly from the vendor manufacturing site. based on a DSL (Definitive Software Library). and support of your company/SECG Master Agreement. facilitation and coordination of the rollout. and post-implementation support. 8 . Asia Pacific North (AP-N). and utilize proven processes and methodologies. and protective maintenance coordination. and changes on site for both hardware and software. subleasing. lifecycle management. adhere to schedules. In case remote access is not possible or included in the scope. Problem Management or Break/Fix Involves support by facilitating a replacement (swap) strategy as the solution to improvement of the desktop availability. adds. SPOC services will also be made available by way of a web-based “Virtual Program Office. ensure consistency and quality of the products and services being deployed. installation. preferential treatment of supply and worldwide. All repairs are handled off-site. MACs (moves adds. The rollout assessment. The advantage to your company is that supply is reserved in each geography/ country specifically for your company. without a user waiting for the return of his desktop. modular solution that supports all or selected aspects of asset control as summarized below. Rollout Key elements of SECG’s rollout strategy include implementation planning. The SECG Value Proposition includes rollout of the desktops and servers in the client environment in close cooperation with our logistics partners. and technology exchange options. The supply component of the SECG Value Proposition to your company includes a direct fulfillment model. INTEGRATED ASSET MANAGEMENT AND SUPPORT SERVICES SECG can provide your company with an integrated. coordination of problem and warranty handling. the lease in the original country is terminated and re-established in the new country under the lease terms and conditions for the new country. moves. however. The SPOC concept provides vendor and supplier/distributor-independent control over all asset management processes as well. Europe/Middle East/Africa (EMEA).” The Virtual Program Office (VPO) will function as the "control center" for the management. site readiness assessment. Single-Point-Of-Contact/Virtual Program Office The SECG Value Proposition provides a single-point-of-contact (SPOC) for issues related to assets that are placed under asset management control. execution. Asia Pacific South (AP-S). Major objectives of the rollout will be to minimize business disruption during the deployment. If a product is constrained in some way. Other flexible lease features include like-for-like exchange at the end of the lease. This includes vendorindependent management of client contracts for hardware and software. pre-delivery preparation. The rollout will leverage systems management and advanced management technologies to facilitate the deployment.Rather. Such a program is designed to facilitate consistent. Software Control An implementation. Software Distribution This is performed either at the point of distribution. and Latin America (LA).

The goal is to verify the compatibility of hardware and software to customer-specific configurations. and provide the linkages to logistics partners in support of product fulfillment objectives.Physical Security This involves asset protection. 9 . Testing and Certification SECG works with hardware vendors to handle testing and certification of standard and non-standard software and hardware as support for the change and software distribution process. in order to lower risk of theft. test existing customer images on new hardware. and integration with the enterprise asset repository. implementation.

asset data capture. and security)  Enterprise-wide Asset Management (links procurement process and facilitates optimization of PC usage) STRATEGIC PROCUREMENT Strategic Procurement involves an evolution of opportunities. In order to successfully address these critical issues. confirmation/ review. including:  Process Automation  Standardization  Single Sourcing  Volume Procurement (versus transactional)  Lifecycle optimization  Lease Financing (versus purchasing) Process Automation Process automation is highly beneficial for companies that employ a transaction-oriented procurement process. lead to substantial cost reduction opportunities while enhancing service levels and improving customer satisfaction. Linkage elements include: Systems Management (migration. higher risk. TCO information is most effective when viewed from an end-to-end asset management perspective. The Total Cost of Ownership (TCO) of a PC describes the hard and soft costs associated with the owning. deployment. and 3) Risk Mitigation. The figure. it is important to know all costs associated with ownership of a PC. with progressively increasing cost savings potential. when deployed in an integrated fashion. operation. Planning/Forecasting Steady-State Disposal Procurement Configuration & Installation The greatest cost saving opportunities are realized by focusing on lifecycle processes including procurement. and results in high structural cost savings and increased customer satisfaction)  Autonomic Solutions Architecture (Advanced technologies that reduce administrative costs of deployment and management of a PC throughout its lifecycle. wireless. status tracking. reconciliation. image management). This is especially true when implementing PCs in a business environment. These issues seem to be in conflict with one another. Implementing key end-to-end “best practices” can. Typical companies spend between 6% and 10% of the hardware cost on procurement activities. and disposal of a PC asset in a business environment throughout its lifecycle. Process automation can generally reduce those costs to less than 3% of the hardware cost. and reporting. These expenditures are over and above the actual hardware cost. cost-saving business decisions. it would seem to be impossible to improve service levels while reducing costs and without increased risk. lifecycle optimization. is a simple representation of the full lifecycle process. and leasing)  “Push” deployment strategy (removes end-users from the procurement process. These PC lifecycle “best-practices” include:  Strategic procurement (includes process automation. volume procurement.BUSINESS CASE According to surveys. where many costs are hidden and the complexity of the infrastructure makes support difficult. 10 . manageability. single sourcing. below. Elements of best in class procurement systems include order entry. Not understanding the total cost of ownership of a PC may lead to poor management decisions. facilitates rapid deployment. eliminates the concept of order cycle time. That is. Understanding these costs facilitates management of the IT infrastructure and enables significant. standardization. 2) Maintaining or improving service levels to end users. and asset management. and higher costs. the three dominant issues facing CIO's today are 1) Cost management and/or cost reduction. receipt verification. The greatest cost saving opportunities are realized by focusing on the complete end-to-end process.

as parts become harder to acquire. by eliminating hardware upgrades and limiting break/fix activity to warranty service only. Volume Procurement Volume procurement can lead to additional hardware cost savings. etc. etc. The key to realizing the savings and benefits of standards will be the development of an operating discipline that motivates compliance to these standards with limited exceptions.). This type of expense lends itself well to an activity-based costing environment and simplifies charge-back administration.). upgrade activity increases. 11 . This is not surprising. In addition. Leasing provides the mechanism for managing obsolescence of the technology. break/fix costs go up and continue to rise. a less complex service environment (one set of spares. Disposal of the equipment at end-of-lease is built into the model. and can lower procurement costs. Because of the reduced complexity of the environment. one set of evaluation units. and disposal costs. and disposal costs. Components of the SECG lifecycle cost model include the hardware price. Traditional transactional procurement environments amplify inefficiencies in forecasting and procurement activities. It is recommended that companies establish two to three standard specifications that are based on specific requirements of the strategic business units within the corporation. as the hardware ages. IT administrative costs. Incremental annual cost savings for an operating lease can be substantial. procurement cost. On top of savings potential. and technology advantages. can result in substantial incremental annual hard cost savings for your company. on an equivalent uniform annualized basis. is defined as the deployment of product from a single manufacturer. Vendors generally can realize greater efficiencies in manufacturing and fulfillment processes. fewer parts. Additional benefits include simplified supplier relationship management (one set of briefings. This will benefit your company by improving forecasting and lowering effective order cycle times. Under an operating lease. Optimizing the lifecycle. operating leases also offer administrative benefits as well. such as deployment automation and built-in software distribution. maintenance and support costs are lower – up to 25%. SECG assists its customers to establish unique price indexing mechanism and supply guarantees that help to mitigate the perceived risks of selecting a single supplier. SECG has demonstrated that. the procurement transaction becomes an off-balance sheet expense. deployment (includes image development and maintenance. Determining the optimum lifecycle of a PC can result in considerable cost avoidance. Financing Financing is the final element of the strategic procurement formula being recommended for your company. in that the typical warranty is also three years. After the warranty expires. Lease terms have become flexible. Single Sourcing Single sourcing. Leasing also eliminates the need to pay property taxes for PCs and eliminates administrative cost incurred for managing property records. it is possible to identify the optimum lifecycle of a PC. As part of its value proposition to your company. with options such as. Turning over inventory at the optimal lifecycle point virtually eliminates upgrade costs and has a substantial impact on break/fix costs. and installation costs). Process and administrative costs are positively impacted as well. like-for-like exchange at the end of the lease and cross border lease transfers. year after year.Standardization Standardization impacts IT administrative costs. configuration. Volume procurement reduces procurement and IT administrative costs by spreading them over a large number of units. Standardization reduces redundancy in support services and facilitates improved services. SECG studies have shown that the optimum lifecycle of a PC (includes notebooks) is approximately three years. by viewing these costs from a cash flow perspective. An operating lease can be attractive from a financial and an administrative standpoint. and break/fix costs (warranty uplifts and post-warranty costs)). Lifecycle Optimization The optimum lifecycle of a PC is the duration of time that a PC should be deployed within an enterprise. planning. which translate into lower hardware costs for their customers. steady-state support (includes hardware upgrade costs and the associated labor to install them.

single sourcing. It involves advanced aggregate planning. extension of the wireless LAN.  Distributed Wireless Security Auditor (DWSA) – Facilitates the detection of "rogue" security risks in wireless networks. The customer does not own the PC asset. eliminate costs that will otherwise be incurred over and above the hardware price. Advanced aggregate planning and forecasting is a key component of the “push” implementation strategy. This strategy requires the deployment of a volume or systems-type procurement methodology as opposed to a transaction-type procurement system. based on Lenovo ThinkVantage and LANDesk technologies. and large volume asset replacement. it is therefore possible to reduce costs while increasing service levels. Invoices for hardware and services are consolidated into a single invoice. asset management simplification.1x security support 12 . that is. Some of these types of technologies include:  Client Recovery and Rescue . and security. reduction of cabling costs. thus. and administrative cost reduction. and connectivity. Advanced systems management technologies feed the concept of autonomic computing. standardization. The “push” deployment strategy lends itself to lifecycle optimization. Compliance with a strict operating discipline for managing the lifecycle as described above yields considerable financial benefits. and image management). “PUSH” DEPLOYMENT STRATEGY The second “best practice” is based on a “push” deployment strategy. and facilitation of “off-the-books" PC deployment. This strategy removes the end user from the procurement process.Automatically detects wireless and wired networks and configures the PC to work with them.Additional financial benefits are achieved with an on-demand-like “price per seat” model. Because advanced planning is required and implementation is done in a “big bang” (total asset refresh) approach. In the “push” strategy. This leads to high customer satisfaction ratings – usually a 2X improvement over tactical buying customer satisfaction ratings. wireless. business-driven standards. An assessment. process automation. The assets simply are taken away and the monthly invoice ceases. Benefits include change management enablement. as well as natural links to ESM tools. the customer has the flexibility to both increase in size and number of assets or decrease in number without the payment of termination penalties. Wireless networking has emerged as a major enabling technology. having the automatic capability of self diagnosis. and perhaps most importantly. This assessment demonstrates that advanced management technologies can result in deployment and asset management savings of close to US$170 over the life of a PC. with the benefit being the perceived reduction in order cycle time.  Instant Connections . Conservatively estimated. procurement automation. AUTONOMIC SOLUTION ARCHITECTURE Development of an Autonomic Solution Architecture consist of implementation of advanced technologies that reduce administrative costs of deployment and management of a PC throughout its lifecycle. the overall savings that are possible through lifecycle optimization in a “push” implementation strategy and the implementation of universal management technologies can be as much as US$200 to US$250 per PC per year for a typical company. facilitation of operating cost reduction in desktop to mobile transition. of cost savings for the most fundamental lifecycle processes can be found in Appendix A. the customer receives a single invoice per PC on a monthly basis for the duration of the PC lifecycle. The benefits of these TCO/technology linkages include increased efficiency. which allows the customer to bundle hardware and services together. PC deployment is based on business need and job as opposed to individual user preference. This is because one time procurement costs are spread over a large volume of PCs. Through the implementation of the “push” strategy. Concurrent with the emergence of wireless networking as a major enabling technology are wireless-related technical solution requirements. The “push” deployment strategy also favors rapid implementation. replacement of leased lines. SECG’s technologies. It is also estimated that wireless nodes can be implemented at a 50% reduction in cost over wired networks. As well. Linkage elements include: Systems Management (migration. These include:  Fully integrated antenna design – no sacrificing of ports  IEEE 802. the procurement costs per PC are essentially eliminated.Facilitates data recovery and continued operations after catastrophic PC failures. Rather. manageability. self-healing.

lease management. based on market assessments include:  Hardware-based security (Trusted Computing Group Compliant) – Secure storage of user identity.  Standards-based – Support of industry standard cryptographic interfaces Conservative savings (from the implementation of these technologies) are estimated to be approximately US$21.Lost business traced to customers moving to "safer" environment .Loss of customer trust . 13 . Such an integrated solution can yield additional savings on a “per PC per year” basis. These processes involve the capture of relevant data for PCs and peripherals through the entire lifecycle of a PC. and repair . and asset usage optimization. containment. over and above the savings already described from the “push” implementation strategy. Some related activities might span country borders or taxing entities within a country. preventive hardware maintenance.00 per PC per year. with the actions and results being highly dependent on the timing of an event.Public relations costs . Effective oversight of the challenges of asset management with an enterprise-wide asset repository and automated processes can result in significant capital and administrative cost savings as well as considerable productivity enhancements.00 per PC per year.Increased insurance premiums . built-in smart card function  Data Protection – dedicated encryption capabilities.Competitor access to proprietary information Security-related technical solution requirements.Labor and costs associated with detection. It is important to look at how asset management decisions affect the business environment. ASSET MANAGEMENT Having established a baseline for the total cost of ownership of a PC within the enterprise. Some asset management decisions are time-sensitive.includes multi-vendor interoperability and meet international regulatory requirements Integrated wired and wireless solutions Consulting services PC-related security has also emerged as a major issue with corporations around the world. with seventy-four percent experiencing losses. PC theft has increased with rise in mobile users. and password banks. These losses can be categorized in terms of tangible and intangible costs:  Tangible Costs of a Security Breach .Lost business due to unavailability of breached resources .Loss of business due to bad press . enhanced decision support. secure web browsing  Device and user authentication – Approved devices identifiable by the network. simplification of audits.Costs associated with gathering of evidence and prosecution of hackers . improved up-time. the maintenance and distribution of software. Steady-state asset management is a set of business processes. Losses average US$33. Additional benefits of a comprehensive implementation of integrated asset management tools and processes include shortened delivery cycle times. Security Breaches – Ninety percent of companies have experienced breaches. proximity badges. automation of user authentication with biometrics. The cost of theft for typical corporations (based on actual cost study data) is approximately US$2. under which the configuration and use of a PC is monitored and controlled. Security issues can be broken into two categories:  Physical Property Protection – Theft  Security Breaches Theft – The highest cost impact of theft is from loss of proprietary information. and improved effectiveness of training programs. elimination of hardware tokens.Legal costs associated with liabilities resulting from breach  Intangible Costs of a Security Breach .    Software to automate and simplify mobile connectivity Industry standards compliance . not accessible from memory or from disk drive. it is crucial to develop a strategy for managing PC assets. This equates to a 60% reduction of security-related risk.00 per PC per year.

and limit break/fix to warranty service only. In addition to SECG’s capability to deliver a complete “end-to-end” asset management solution. from a products and services perspective.  Implement a “push” deployment strategy. and “big bang” volume replacement. deployment. A complete listing of these differentiators can be found in Appendix B. and disposal. SECG differentiates itself from its competition in its ability to provide value-added services and capabilities for each of the “best practices” that comprise the business case above.  Optimize the PC lifecycle by turning over technology within a three-year lifecycle. 14 . definition and implementation of a limited number of standards with limited options.  Utilize flexible financing options to manage the asset and its related services.  Implement a hybrid ordering strategy that takes advantage of direct ordering from the manufacturer as well as through value-added resellers. eliminate hardware upgrades within the optimal lifecycle. including advanced aggregate planning and forecasting. with flexible asset tracking and reporting capabilities.  Establish a limited number of standards with processes and operating discipline to manage exceptions. SECG is uniquely positioned to implement this business case. steady-state asset management. BUSINESS CASE SUMMARY The overall business case for a “Best Practices” environment is summarized below:  Implement an integrated procurement and asset management system. including procurement automation and an enterprise-wide asset data repository.  Exploit SECG advanced management technologies to reduce administrative cost in the areas of procurement.Implementing end-to-end lifecycle management “best practices” in an integrated fashion will position your company to optimize the usage of the technologies being deployed and realize the maximum cost savings over current practices. integrated with the procurement system. in an integrated fashion.

This includes documentation and validation of actual “as is” customer process costs. and asset management processes at your company or organization. including vertical integration with server solutions. deployment.)  Rollout Deployment Planning – SECG will conduct a two-day seminar.Disposal Management  TCO-related Savings Guarantee – SECG will back up its partnership agreement with the vendor with a written commitment to achieve a specific level of cost savings. In return SECG will commit to provide the following to your company:  Single Point of Contact – Strategic Enterprise Consulting Group  Business Case Development  PC Lifecycle Cost Assessment .  Training Roadmap – Includes identification of critical skills and on-site skills transfer sessions.  Applications Portfolio Planning – SECG will conduct a two-day seminar to outline application portfolio issues and strategies that may be impacted by “best practices” rollouts  Transition Support and Technical Support Plan – Hand-off from SECG sales support to long-term support programs. and “price per seat. Self-maintainer training & certification. SECG will quantify process costs (including shadow processes) based on customer-supplied data. SECG is offering to participate. transitioning to a more mobile work environment. With validated baseline costs. the implementation of Total Cost of Ownership (TCO) methodologies and practices offers your company the potential for significant savings. it is possible to evaluate practical application of PC-related “best practices. systems management script translation. in principle.” such as process automation with low-level systems management tools. based on the lifecycle consulting studies that are performed.Deployment Services . etc. regional issues  Hardware Pricing Optimization – Via indexing and fulfillment management  Services Sourcing – Pricing based on prototype and integrated test .Includes a benchmarking assessment of procurement.”  Vendor Transition Guarantee – SECG offers to assist its customers in mitigating risk and switching costs in transitioning to SECG as the principle vendor. with substantial resources. We are proposing that your company and SECG enter into an agreement wherein your company will commit.e. 15 . Key issues and roadblocks will be identified and high level plans developed.Project Management . and provision of consulting assistance and services designed to mitigate transition cost – resources will be applied as required (i. In the interest of assisting your company in achieving the benefits offered by our industry leading TCO capabilities. in a joint shared risk/shared reward project. calculation of transition cost and associated risk based on a combined customer/SECG assessment.  Process Reengineering/Architectural Solution Design – Process design and operating discipline for the deployment of TCO-related advanced management technologies.PARTNERSHIP OFFERING As discussed in the previous section. to implement the elements of the SECG Value proposition. tax mitigation. which would facilitate your realization of these savings.  Global Account Management – Fulfillment. the purpose of which is to provide knowledge transfer of “best practices” associated with managed PC rollouts.

Less than five minutes when automated. changes) US$10/PC/Year SMA Disposal US$55/PC WOL. LANDesk General Assumption: Labor rate: US$75/hour fully burdened Total estimated savings = US$270 (over life of a PC) Estimated annualized savings = US$106 per year (assume typical cost of capital and tax rates) 16 . Manual process = 60 minutes Automated process < 20 minutes Manual disk erase and file transfer (including travel time) = 1 hour. Sixty-five to seventy percent of users require some level of remote support once per year. Recovery) US$5/PC/Year Rescue & Recovery Support (Remote Control) US$25/PC/Year LANDesk MAC (Moves.percent reduction in procurement costs can be achieved through process automation. confirmation/ review. Support (Configuration Restore. Wake-on LAN AIC. status tracking. LANDesk. The typical process (including travel time) requires one hour. adds. Fifty. or restoration of image load. configuration recovery. Automated process: <3 minutes Manual process: 10 minutes Automated process: <2 minutes Less than 6% of PCs require BIOS refresh. AssetID Asset Data Capture/Tagging US$10/PC AIC. reporting) Savings US$50/PC Tool Direct Access Assumptions Typical procurement costs are 6-10% of hardware cost. AssetID. SMA. Assume one hour of labor to perform restore or recovery operation manually. reconciliation.COST SAVINGS ESTIMATES Process Procurement (order entry. Manual process: 15 minutes. Nominal reduction of 60 to 80 minutes off of standard processes. Eighteen to twenty percent of user base is involved in a MAC each year.APPENDIX A THINKVANTAGE ADVANCED MANAGEMENT TECHNOLOGIES . SMA is used to capture and transfer data. Assume that remote control results in a fifty percent reduction in support time. Automated process = 15 minutes Configuration/Installation US$100/PC Receipt Verification US$15/PC IUB .

e.APPENDIX B SECG VALUE-ADD – END-TO-END “BEST PRACTICES” Strategic Procurement • Order Process Automation .SLA/Vendor management .Invoice reconciliation .Technical Support (7 day x 24 hour) • International Warranties Autonomic Solution Architecture • Integrated across desktop. etc. etc.Partial orders .Asset data repository feeds • Standardization – Global product offerings • Single Sourcing – Price indexing (multiple options) • Volume Procurement – Global Priority Supply • Lifecycle Optimization – Business case justification. financial. HP OpenView. CA. unique financial models • Leasing – Flexible lease options (i. and server lines • LANDesk Suite with ThinkVantage Technologies. • Integration to other ESM solutions: Tivoli.A single front end for cataloging and order placement/tracking (including third party components) . cross-border lease transfers. software. Microsoft. like-for-like exchanges. demographics. notebook. warranty • Integrated solution: direct feeds of procurement (and lease) data • Linked to key Help Desk solutions 17 . SMS • Resource teams for solution design and implementation • World-renown TCO/Asset Management consulting expertise Enterprise-wide Asset Data Repository • Strategic links to enterprise systems management tools • Full-featured: Hardware.Order Review .) Push versus Pull • Vendor Imaging Technology Center • Global Program Management Expertise and Intellectual Capital • Rapid Deployment Expertise (Technology-assisted) • SECG/Vendor HelpCenter .