Scrimp on IT support at your peril
Increasingly, businesses are being seduced by bargain basement IT support contracts, wrongly assuming – as with, for example car insurance – that one policy arrangement is much the same as the next.
Most dangerously alluring of all, potentially, are the brand-backed services by the hardware equipment vendors themselves. To the customer, preferential terms being offered here appear easily explained by the supplier’s sheer size and economies of scale. Then there’s the argument that a hardware producer must surely be an expert in core technology. There is an assumption too that, with their heritage and reputation in the marketplace, their service offerings must be robust and reliable, among the best the industry has to offer.
More commonly, the reality is the opposite. I’d argue those that provide IT support services as a ‘bolt on’ to other, core business activities are least likely to invest in the quality and comprehensiveness of those services.
It’s not until something goes catastrophically wrong that the customer organisation finds this out. All too often, they find themselves having to wait days for spare parts so that a core system can be rebuilt (losing productivity and business in the meantime). In saving £500 on their annual service contract, they now find they may have incurred £5,000 in unforeseen ad-hoc costs, just to resolve a single incident.
It is only in crisis that customers realise what a false economy it is to skimp on IT services. If it’s a choice between spending £1,000 and getting a solid service contract that will deliver in a crisis, or halving that and leaving the business to chance, the decision should be a no-brainer.
* Paul Timms is operations director at Maindec
![[Bloglines]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/bloglines.png)
![[del.icio.us]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/delicious.png)
![[Digg]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/digg.png)
![[Facebook]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/facebook.png)
![[Google]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/google.png)
![[LinkedIn]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/linkedin.png)
![[Twitter]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/twitter.png)
Yes, but every category of spend claims, quite rightly, it is special. Skimping and scrimping is not what good procurement does, but IT support, like everything else, has its fat, and its haphazard allocation of overheads, and its cosy historic relationships. Procurement should validate and compare and negotiate on IT support spend. It is vital to understand the value your suppliers bring, but special pleading does IT support no favours.
The decision is no-brainer but need to be based on evidence. Procurement tries to understand and substantiate IT claims’ legitimacy. As we all know IT generation teaches us to look closely into these claims. No offence Paul, but Procurement has a job to do.
Paul refers to IT support in the context of hardware support only. What about software support? Do 80+% margins (which are not untypical)on software support represent good value for money? Is it churlish of IT Procurement professionals to want to get behind the facade and understand what exactly is being delivered for the money being paid? If the support supplier can demonstrate real value for money (with all that this entails) against its competitors, it should not be afraid of these challenges but should welcome them.