IT asset management (also known as ITAM) is the process of knowing; where your organisation’s IT assets are, how they are performing, the plan to maintain them and how they’ll be disposed of when they have come to the end of their useful life.
IT assets include hardware – computers, laptops, servers, and software – licenses and applications. In our experience, larger businesses, particularly those with multiple locations, fail to follow best-practice ITAM. This means they are operating from incorrect data and records, which leads to over-consumption, unnecessary spending and lost value.
Common mistakes in IT asset management
Several small things lead to bigger issues when it comes to ITAM.
- Human error is the primary source of poor asset management and contaminated data through double entries and key person risk – i.e. when the record keeper leaves.
- While network tracking software is useful, it only tracks hardware turned on and in the network, so it cannot be relied upon as a standalone solution.
- The same software does not monitor the performance or configuration.
- Legacy and specialist equipment are managed separately or not at all if it isn’t compliant with tracking software.
- Almost all managed service providers either use tracking software or start with contaminated records, replicating organisations’ issues.
What is best-practice IT asset management?
DEC believes best-practice ITAM is independent, multi-pronged and human-assisted.
Starting with accurate data around what, where, performance, warranty and value is the key to achieving a single source of truth and maximising the ROI of your IT investment. While leveraging technology and automation as much as possible is important, the reality is software cannot count every piece of physical hardware you own. This can only be achieved by undertaking physical stock takes in each location.
Once you have that, you can use software and human resources to optimise, upgrade and dispose of your IT assets proactively. If you are implementing best-practice ITAM, here are six benefits you can expect to realise.
- Saving Money
From experience, we put the average IT budget spend for most large companies at around 3.5% of turnover (revenue). Hardware takes up between 30-45% of that budget.
Typically, our clients save 25-45% of their hardware budget in the first year and 10-15% in subsequent years by following a proper ITAM system. So if your company has an annual revenue of $100m, that would be $875k-1.57m of possible savings in the first year.
A best-practice ITAM process also uncovers hidden value by understanding your assets’ real-time value. Knowing what you can get in the current market for unused or unwanted hardware can add thousands if not hundreds of thousands of dollars to your balance sheet.
2. Make informed decisions
CIOs make decisions on how they will manage, control and upgrade IT assets based on the visibility of what’s in their network. CFOs formulate budgets and manage their balance sheets based on the information available about your company’s IT assets. When this data is incomplete, contaminated and inaccurate, the decisions leaders make off the back of it can end up costing your business in multiple ways.
When ITAM is followed correctly, decision-makers can plan more effectively because they know, in real-time, what they have, how it’s working and how much it is worth.
3. Boost performance
Performance monitoring is an element of best-practice ITAM that focuses on storage, memory, CPU, and network utilisation indicators. Based on the results, specialists tweak the network to optimise asset usage. It also enables organisations to reduce downtime by identifying and fixing small bugs before they become big issues, identifying the impact of incidents more quickly and removing blockages within the network. Finally, it provides ongoing accurate information that supports other business processes.
4. Maximise ROI
Laptops have a useful life of 3-5 years for your average make model used within a corporate setting. Warranties last for three years or less. Many organisations simply upgrade when the warranty ends, but they are potentially missing out on another two years of use.
A robust ITAM process supports legacy hardware and software beyond the manufacturer warranty. Because the organisation has accurate data, it is confident it can access parts and quickly repair hardware when required. Extending the lifecycle of what you already have maximises your ROI by reducing unnecessary spending and allows you to plan for future IT needs more accurately.
5. Reduce security risks
Accurately knowing everything about your assets helps organisations anticipate and protect against the kind of threats they may be vulnerable to, for example, phishing emails or DDoS attacks. By associating an asset with a purpose, cyber security teams can also better understand the level of security required. This helps you stay compliant and be well-prepared for audits, reducing your legal and security risks.
6. Contribute to the circular economy
Lifecycle management is not just profitable; it is vital for the health of our planet. You’ll be reducing consumption and contributing to your organisation’s sustainability targets through reusing, reselling or recycling. Properly planning for correct disposal once your assets reach the end of their useful life ensures the most positive environmental outcomes, which shareholders and communities are now closely monitoring.
Photo by Pixabay: https://www.pexels.com/photo/gray-wooden-computer-cubicles-inside-room-267507/