Benjamin Franklin once said, "The way to wealth depends on just two words, industry and frugality." Facing the most uncertain economic climate in decades, frugality has become the predominant instinct among healthcare organizations. However, when it comes to technology - and IT infrastructure in particular - the impulse towards frugality must be combined with the intelligent implementation of industry.
In a volatile economy it is standard protocol to cut back on budget and expenses - luxuries must be curtailed. However, IT infrastructure is not a luxury. It is the lifeblood of every aspect of the healthcare industry. It enables business processes and decision-making, it fuels organizational efficiency and it is the essential to communication, collaboration and innovation.
That's not to suggest healthcare organizations should spend indiscriminately. But they should continue to invest in technology that strengthens their infrastructure and positions them to take advantage of the turn-around ahead. By recognizing the "consumable" nature of IT equipment, and by establishing a framework for measuring obsolescence, they can implement a systematic retirement and replacement program for outdated equipment over multiple technology life cycles, which can actually save money in the long run.
When considering an IT budget, keep in mind that only 20 percent-30 percent of the average overall spend goes to the up-front purchase of new equipment. The remainder of the budget goes to IT labor, configuration, ongoing support and equipment/software upgrades. Simply stated, if IT managers are vigilant in keeping their equipment modern and functional (basically investing up-front) they will spend less on labor, support and upgrades which can lead to a far heftier overall cost during the life of equipment.
Increasingly, savvy leaders recognize the value of managing across the full portfolio of their investment, versus replacing individual servers or PCs one or two at a time as they wear out. This helps them manage to the lowest total cost of ownership by dramatically reducing maintenance expenses and optimizes the performance of their IT infrastructure by bringing newer, more-efficient generations of equipment online at programmed intervals.
If your company or organization has not yet developed a strategic plan to manage IT assets on a portfolio lifecycle management basis to save money and add capabilities, now is an excellent time to look into it.
Tom Adams is vice president and managing director for HP Financial Services in the Americas. He's responsible for business direction, sales, operations and portfolio management for the United States, Canada, Latin America and the Caribbean.