This paper is the intellectual property of the author(s). It was presented at CAUSE98, an EDUCAUSE conference, and is part of that conference's online proceedings. See http://www.educause.edu/copyright.html for additional copyright information.

We are going to look at the factors and elements that make up the Total Cost of Ownership (TCO) for desktop computing. Over the last ten years, the TCO for desktop computing activities has been dropping in general terms. Institutions that actively addressed and developed strategies and programming to reduce the major computing cost components are now seeing benefits. If your institution has not addressed at least three components, you are probably not seeing a cost reduction. In fact institutions and companies that have not addressed TCO are continuing to experience out-of-control cost increases for desktop computing. Addressing only the purchase price for desktop computing will not sufficiently make a difference.

October 21, 1998

By: Alden T. Coleman II
Team Leader, Contract and License Administration
Computing and Academic Services
Division of Information Infrastructure
University of Tennessee

400 Dunford Hall 915 Volunteer Blvd

Knoxville, Tennessee 37996-4050

E-mail address: [email protected]

Web address: www.cas.utk.edu/depts/pam selection hardware or software

(423) 974-2699 voice (423) 974-2050 faxes

Abstract: *

Acknowledgements *

Lowering the Total Cost of Ownership for the Desktop *

What is TCO and Why Bother *

What Makes Up TCO *

Basic Elements for Tracking TCO *

TCO -- Purchases Price Findings *

What Limits Should Your TCO Model Have *

Soft Standards and Simplified Procedures *

TCO � Training Findings *

Annual application(s) or system(s) change *

Compute loss productivity while in training *

TCO � Applications Findings *

TCO � Maintenance and Support Findings *

TCO -- Environmental Changes Findings *

TCO � Contractual Technical Support Findings *

Recommendations to Lower your TCO *

Purchasing *

Training *

Applications *

Maintenance and Support *

Environmental Changes *

Contractual Technical Support *

APPENDIX *

A - Where to find us *

B - About the Author and Presentation *

C - UT�s Standard Desktop configurations *

D - Other References (online) *

E � Acquisition Cost Calculation *

F � IT Support Staff *

Figure 1 - TCO by elements 1^st year *

Figure 2 - TCO by elements 5^th year *

Figure 3 - TCO over 5 year life cycle *

Figure 4 � Vendor Training cost VS CBT cost *

Figure 5 � Author and Presenter *

Figure 6 � Support staff and budget *

The information complied in this document has been accumulated over the past five years with the help of several individuals. Their direct or indirect contribution to the development of this document has made it possible for me to show the status of the desktop environment at the University of Tennessee, Knoxville campus. I have listed these individuals in no specific order and I apologize for any and all omissions:

S. Mettlen Vice-Chancellor, Division of Information Infrastructure

D. Latimer, Director, Computer and academic Services (CAS)

J. Gipson, Acting Director of strategic Planning, Telecommunication and Network Services (TNS)

R. Valentine, Director, Division of Information Infrastructure (DII)

J. Jarrard, Director University Wide Computing Services

J. Vaughan, Business Office

B. Delaney, Training and Customer Service J. Huddleston, Business Office

R. Maples, Controller J. French, Student Services

W. Strickland, Student Services T. Rodgers, Dean of Students

L. Scalf, Hardware Procurement R. Edwards, Hardware Procurement

E. Lillie, Software Procurement P. Broughton, Software Procurement

R. Caudle, CD-ROM Production N. Gnilka, Customer Service and Training

H. Row, College of Arts & Science S. Johnson, College of Engineering

M. Rozanski, College of Education C. Kaseworm, College of Education

M. Sthal, College of Business R. Jackson, Continuing Education

J. Lewis, Veterinary Medicine B. Dearden, College of Agricultural

J. Robinson, CAS Support line S. Pinkerton, TNS Telecommunications

E. Baumgardner, TNS Desktop Support P. Newman, Fileserver Support

G. Bass, TNS Desktop Support G. Womble, Administrative Applications

C. Fornes, Business Services J. Wade, Purchasing

D. Alexander, Purchasing M. Wilson, Purchasing

J. White, Maintenance & Supply W. Keanaaina, Surplus and Disposal

J. Grossen, CAS Special Projects R. McNiel, Student Computer Labs

R. Grant, DELL Computer Mfg. C. Gibson, Gateway Computer Mfg.

S. Blazzard, Hewlett Packard Mfg. S. Garrnet, SUN Computer Mfg.

J. Eden, Compaq Computer Mfg. L. Allison, IBM

S. Bullard, Editor L. Campbell, Student Assistant

C. Hart-Roberson, Researcher

We are going to look at the factors and elements that make up the Total Cost of Ownership (TCO) for desktop computing. Over the last ten years, the TCO for desktop computing activities has been dropping in general terms. Institutions that actively addressed and developed strategies and programming to reduce the major computing cost components are now seeing benefits. If your institution has not addressed at least three components, you are probably not seeing a cost reduction. In fact, institutions and companies that have not addressed TCO are continuing to experience out-of-control cost increases for desktop computing. Addressing only the purchase price for desktop computing will not sufficiently make a difference.

Sweeping changes and improvements in technology continue to challenge our institutions to reshape and redefine how best to deploy computing power. Unless you have a handle on what it takes to acquire, implement, and support desktop computing, it may prove too expensive to stay current. By addressing the components that make up the TCO, your institution will be in a position to take full advantage of the latest innovation in computing, communication, educational and training techniques, and information science/technology. You will find it very difficult, even impossible, to implement an institutional word processor standard using one of the latest Office packages. When your enterprise is using 8086 PC�s running at 20mhz with 30megabye hard drives running DOS or windows 3.x. Or it would be impossible to implement an institutional wide Web based client server application with the older PC�s running at 20mhz with 30megabye hard drives on DOS. But this was the typical personal computer found throughout some colleges and universities ten years ago.

Total cost of ownership is more than the original cost of purchasing hardware and software. TCO must include all direct and indirect costs associated with desktop computing. Desktop computers have a typical life span of five years. At some institutions this life span may be more like ten years. In both cases the older units are either shipped to surplus or given to faculty and staff for home use. But these home-based units are also being moved to surplus because they cannot be used with the latest hardware and software packages. The Gartner Group reports single year cost between $6k - $16k for a PC running Windows 3.1 operating system. We found more than 70% of the TCO is involved in non-purchasing activities. Being aware of the TCO components is the first step in lowering your institutional cost. Introducing the wrong or incompatible technologies onto your campus can be very costly.

Limiting choices and setting standards are the best methods for starting to get control of your institutions cost. However, forcing individuals to buy a single type of computer maybe the fastest way to bring desktop computing under control. This is also the hardest method to implement. Both individuals and organizations have developed enough expertise and knowledge to be able to buy their own computer equipment. We must remember that we are talking about "Personal Computing Equipment" and a "personal desktop environment". Soft Standards will work best in bringing the entire enterprise to accept a standard and limited choice. Limited choice must include enough variety to cover most user�s requested needs.

Since its inception in 1987 a variety of elements have been included in a TCO definition. Our institutional total cost of ownership is more than the original purchase of hardware and software. We have defined six different base elements that make up the cost components for the desktop computing. Your institutional cost components may be different but, we feel some variations of these elements will cover the expenditures now facing your enterprise. The six base elements are: (1) purchase price for all hardware and software; (2) the training cost for the new owner; (3) the application change(s) cost to become or maintain compatibility; (4) the maintenance and support staff used to get and keep the desktop operational; (5) the environmental changes needed to permit connectivity with the university�s communication backbone; and (6) the contracted technical support contract(s), personnel, and procedure(s) in place for the desktop.

The base elements of purchase price, training cost, application change, maintenance and support, environmental change, and contracted technical support are complex in nature. Our institutional total cost of ownership is more than the original purchase of hardware and software. We defined six different base elements that make up the cost components and expenditures for the desktop computing operation. Each of these complex base elements includes several types of expenditures. Listed here are definitions for the base elements.

Purchase price should include all direct and indirect purchases for a desktop. Generally we are talking about the desktop computer, operating systems, base set of utilities applications, and communication equipment and software. Some examples of indirect cost would involve a departmental fileserver or department printer.

Training costs should include all direct and indirect expenditures for training activity required in effectively running the desktop computer. Formal and informal training usually occurs with the installation of every desktop. Cost and method of training vary from local vendors to out-of-town vendors, or local experts to local classes, or computer based training.

Application costs change should include all direct and indirect expenditures for changes necessary in enterprise systems to become or maintain compatibility within the institution. This may vary from tools needed for transaction in a client - server enterprise system to locally developed applications. The implementation of UT’s student system by SCT Banner has forced desktop changes. Some cost are direct and some portions are indirect.

Maintenance and support costs include the personnel and labor force needed to adequately support a desktop computer environment. We have included such functions as a telephone support line, student computer labs assistants, desktop service specialist, desktop installers and troubleshooters, customer service center operations for walk-up help, and staff involved in acquiring and maintaining cost effective contracts for hardware and software.

Environmental change costs should include both direct and indirect expenditures necessary in providing communication linkage to the institutional communication backbone. This will start with the software and network interface card in the computer and end with the maintenance of the communication environment for the enterprise. Typically, the communication port charge is the only component counted. However, the entire communication environment is not in place for desktop computing.

Contracted technical support costs should include direct and indirect costs to acquire and maintain vendor contracts and agreements which provide expert level support. This support includes warranty and maintenance agreements along with second and third level software expertise. Our institution cannot maintain an expert for all the hardware and software being deployed across the enterprise.

Over the life of a desktop computer the base elements that contribute to the cost of operating the computer vary in the percentage of the total cost. During the first year of operation we found the cost elements at the following levels:

• Purchasing 36.3%
• Training 21%
• Applications 19.5% First year TCO at UT is $7,711
• Maintenance 9%
• Environmental Changes 11.7%
• Technical Support 2.6%

Over the typical five-year life of a modern day desktop computer, the base elements start to show different cost contributions. The average first-year purchase price for a desktop computer is $2,800. This includes all the hardware, software, and communication pieces necessary for actual operation. Computer manufacturers are developing faster and faster computers on a 5 – 8 month cycle. However, the basic price point for profitable operation is $2,500 for a typical desktop. Manufacturers can allow a $300 variance in this price point. Thus, newer and faster computer innovations must continue to be developed and delivered. As the new innovative computers are released to the market, the older technology will continue to be provided by low cost vendors. We have found that maintenance and support costs increase dramatically when we purchase these lower cost units. Therefore, their purchase is discouraged and, in some cases is not allowed.

Escalating costs for selection, acquisition, and delivery of desktop computing becomes a problem in the enterprise if each purchase is consider as a stand-alone transaction. The bidding process for a department can take from six weeks to six months to complete. The process involved the person wanting the equipment, a local technical consultant, business office staff, accounting staff, and the purchasing office. A single $2,500 desktop unit would cost the institution $5,260 (reference appendix E for details) when adding the cost of the personnel involved in selecting, bidding, acquisition, and delivery. These bidding processes often resulted in departments settling for something less than they wanted or even worst equipment unfamiliar to the local IT staff. The IT staff cannot support an unlimited number of desktop computer manufactures and models. Since the desktop purchase price included direct and indirect expenditures, some simple standards or guidelines were needed along with a procedure or method to simplify the process.

Development of standards for desktops was a simple process. However, getting the entire enterprise to accept and follow the standards was the problems. There was and will always exist departmental "PC experts" that can determine and direct the desktop computing needs of a single department. The problem was getting these local "PC experts" to accept the same direction or standards. Complexity within a department grows over time, as does the support requirements. When non-standard equipment and applications have been installed good support is difficult or impossible until the department re-tools. As an example, a large department was using older and non-standard hardware along with a fileserver system. When the department lost its support person (local PC-expert) and needed to expand, the IT organization could only tell the department that they needed to re-tool or pay an especially high fee to support their unique desktop computing environment. "Soft Standards" and simplified procedures have since been established for the institution to avoid this situation again.

For the desktop-computing environment we limit the TCO model to the following operating systems: Windows 3.1, Mac OS, Windows 95/98, Windows NT, OS/2, DOS, and Lynx. Unix based equipment was not included because it represents a different type of user.

Efforts to make a difference in our TCO model started very small and each year more have been addressed. Starting in 1989 with the Office of Administrative Computing, desktop standards and ease of acquisition was implemented. Today the Computing and Academic Services department’s current E-commerce acquisition methods and Network Telephone Services’ supported software packages have added to UT’s ability to lower its TCO. Some of the parts to this model have been developed and implemented informally. Agreements between departments and functional areas to support specific types of equipment, software, integrated packages, communication protocol and systems, and operating systems have resulted in a working "soft standard".

"Soft Standards" are implied standards resulting from the simplified procedures, lower cost, full support, and ease of acquiring hardware and software. For software we have developed several campus-wide site licenses for utility or popular packages. Our AutoDesk, Microsoft, and AntiVirus site licenses are examples of "Soft Standards". We provide a $3,750 AutoCAD package to departments for $200, Microsoft Office 97 for everyone is $36, and an AntiVirus package is free of charge. We also provide the $2,500 desktop unit to departments for $2,500 or less with a 10-business day delivery time frame from the day the order is placed. We now have six contracts with "Gartner Group" tier one-two manufacturers to provide a standard desktop for the institution. Our major contracted vendors are Gateway, Dell, Compaq, Hewlett Packard, IBM, and Apple. All of these vendors provide the standard or recommended configurations we feel are compatible with UT’s computing environment, that can be supported, and that our maintenance group will provide long term repair service. These units are TCP/IP and Novell network certified, and support industrial peripheral standards.

Along with the soft standards, we have agreements with our purchasing department to stop any attempts to purchase desktop computers outside our method. Exceptions are provided after a DII review of the customer’s requirements. Since implementing the new procedures in 1996 we have not had to grant an exception. This has resulted in a drop in computer acquisition cost and represents 36.3% of the TCO during the first year, but drops to a 20.7% over the five-year life cycle period. Table below show the TCO over the five-year life cycle.

Every desktop user requires some form of training at least two to three times each year. The training could be formal or informal, in-town or out-of-town, computer based or individual. The most costly form of training is vendor based out-of-town which costs an average of $934 per day. This includes $384 lost time or revenue plus travel expenses. A local vendor class cost an average $684 per day including lost time. One-on-one in-house training session with the departments’ expert cost about $382 for a 4-hour session. Least expensive is computer-based training which costs an average of $45 per course. In general during the life cycle of the desktop the users will attend one formal and one informal class during the first or second year of operation. The formal class will be vendor based and the informal class could be a one-on-one session with a local expert.

Each year of the desktop life cycle at least two events occur that will require some additional form of training. The installation of a new operating system (ex. Switching from windows 95 to 98) would require more training. Also training would be needed for a new release of a utility package like a browser, spreadsheet, word processor, or statistical tools like SAS or SPSS. . A group desires to move from WordPerfect office to Microsoft office 97. Adding a new software package would also require some learning. IT training costs have been dropping because the university community is taking advantage of a CBT site license.

Training is required by IS professionals, faculty, students, and administrative staff every time the desktop computing environment changes. Some typical changes that may result in required skills upgrade or refresher training would be an: a) Operating system change like switching from windows 3.x to windows 95 or windows NT; b) Major utility application switch or upgrade like moving from WordPerfect to Microsoft word or Lotus 1-2-3 to MS Excel; c) Base application change like moving from a host based administrative student system to a client server student system like SCT Banner.

Not all training is through a formal classroom setting. Informal one-on-one short training sessions tend to occur on a regular basis. Have not we all asked the departmental expert on desktop computers to stop by and take some time to provide help for that software package you were trying to learn. We found in some departments that this method of training was the only one used. A single person would obtain the formal training and then train the remainder of the department. This type of training has an indirect cost namely the lost time of both the requestor and the trainer. Based on the $48 per hour rate (including benefits) an average department’s informal training cost is about $9,984 per year. At UT, this has added about $33 annually to the TCO across all desktops under the training section.

Application changes should include all direct and indirect expenditures for changes necessary for enterprise systems to become or maintain compatibility within the institution. This may vary from tools needed for transactions in a client - server enterprise system to locally developed applications. Based on a three year cycle major and minor enterprise system implementation projects have been undertaken. These system changes require either the entire university community or a large portion to modify their desktop software suite. In some cases the desktop hardware must be changed, upgraded, or replaced. These major application shifts were caused by either internal strategic direction shifts or external market factors.

Operating systems new releases like Windows 98, NT 5.0, or Mac OS 8.5 cause major desktop changes for users running DOS, Windows 3.x, Mac OS 4.0. Selection of new utility tools like an "Office Suite" or "E-mail" packages will cause those embracing the new applications to change there desktop The release of Windows 95 or 98 is an example of external factors generating desktop change. Departments and users are faced with updating their desktop operating system to stay current or to run some of the latest software packages.

UT’s implementation of a new student system by SCT Banner has forced desktop changes and upgrades through-out the campus. Some cost are direct as with the cost of the application. While some portions are indirect like the additional software packages needed to adequately utilize the new system. Application profile changes on the desktop were classified in three groups utilities tools, faculty and staff requirements, and last student requirements. Operating systems and office processing suite packages were grouped under utilities tools because, they were common to the entire university community. Grouped together are faculty and staff profiles because these types of users all needed specialized software to accomplish assigned tasks. These tasks are different from the student’s requirements and therefore placed in different groups. Based on our observations a three-year cycle major applications (SCT Banner or Y2K) system acquisition caused a very large portion of the campus community to modify their desktop. This cycle change has affected all the TCO factors. We have equipment upgrades, new training requirements, additional support needs, new application software, and environmental changes as a result of this application profile change. Student profiles were also affected. In this case, all the student Lab computers were to be modified to support the installation of new application software like AudoCad, 3-D studio, Macromedia products, and SPSS. These changes contributed about $275 annually and $750 every third year to the cost of each desktop computer at the UT’s Knoxville campus.

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Maintenance and support costs include the personnel and labor force needed to adequately support a desktop computer environment. We included such functions as a telephone "Help Support Line", Student computer Lab staff and helpers, desktop service specialists, desktop installers, technology procurement staff, troubleshooter, surplus inventory storage and disposal staff, desktop computer consultants, customer service center operation for walk up help, local departmental desktop expert, and staff involved in acquiring and maintaining a set of low cost contracts for hardware and software. For details complete on the type and amount of support available at UT reference appendix F.

About half of the $6.7 million labor cost spent annually for desktop computing support is in the IT organization. The local departmental PC experts’ makeup the remaining supports team costs. As the university community has become more knowledgeable so has the difficulty and complexity of their questions to our support staff. As any example our desktop support group is trying to install 3D graphical accelerators on windows-95, 98, NT, and Lyix machines. At the same time our telephone help desk to fielding questions from both students and to a growing degree parents of our students. Remote access account allows the university community 24/7 accesses to our computing facilities and communication backbone. The time it take to answer these types of questions is growing or remains over several minutes. Simply determining if a machine is under warranty or a services maintenance agreement is no longer a quick task.

Environmental change costs should include both direct and indirect expenditures necessary in providing communication linkage to the institutional communication backbone. This will start with the software and network interface card in the computer and end with the maintenance of the communication environment for the enterprise. Typically the communication port charge is the only component counted. However, the entire communication environment is in place for more that the desktop computing community.

Listed below are the items that must be consider when computing the environmental change TCO cost elements:

1. Network communications wiring and port changes
2. NIC and the communication suite
3. LAN connections and support
4. Desktop printer servers links and support
5. Internet browsers and schedules
6. Software needed to support Client server appications

We found that the desktop computing environment is effected every time the campus environment undergoes a major shift. Example of this would be switching cabling or changing the communication protocol stack or changing the Local Area Network system. All these actions cause the desktop user to adjust his or her desktop computing environment. If they did not know how then service calls were made to the "help desk" and "desktop support" group. The numbers show that ever four years a major environmental change was undertaken. This added $200 to the TCO of each desktop.

Technical support expenditures should include direct and indirect cost to acquire and maintain vendor contracts and agreements that provide expert level support. This support includes warranty and maintenance agreements along with second and third level software expertise. Our institution cannot maintain an expert for all the hardware and software being deployed across the enterprise. Contract with vendors and manufacturers have taken on this roll. As part of our "soft standards" we enter into agreements with vendors and manufactures to extend the support made available to the campus community.

We found several agreements in place with the same vendor or the wrong vendor. Missing service agreements were costing the institution repair dollars. Also the lack of in-place procedures to take full advantage of the services agreements and contractual technical support resulted in their under-use. The entire institution or enterprise must be aware of these in place contracts and agreements to order to use them and see any cost reduction. Cost reduction taken here are indirect as you start to take advantage agreements your desktop support staff will be freed to handle the next problems. Problem resolution and turnaround will be faster thus your customers will be happier.

The keys to lower you original purchasing TCO cost element are given below:

1. Develop standards configurations and review them quarterly.
1. Basic, intermediate, MultiMedia, and Power level
2. Limited the number of vendor / manufacturers - (6 choices)
3. Simplify acquisition of new systems - (web based or e-commerce methods)
4. Certify vendor models and configurations
1. Including OS and NOS, and some peripherals
5. Aggressively retire legacy hardware and software systems
6. Make new technology affordable

The recommended configuration methods we use at our institution may not match yours however, the concept and procedures will work. An example is requiring all new desktop units to have a three year warranty, had reduce our support cost and extended the support staff by using the manufacturers. The four levels: basic, intermediate, multimedia, and power represent the buying patterns on our campus. Where the basic-level is designed for the heavy data entry clerical position on the lower side of the scale. Intermediate units fill the needs for developers, administrators, faculty, and student computer labs. The multimedia computers are configured to support the individual that is developing or researching full motion video courses or projects. The power level is designed for the researcher who needs the most powerful computer available. The configurations in these levels are made so that they will more than just fit the needs of each group. The vendors very aggressively price these groups to generate sales. Our campus support personnel are involved in the guideline compiling so they will be prepared to support the equipment when it is installed. We also communicate with the manufacturers our special campus needs to insure compatibility with our computing environment.

Up front consulting can be handle by your entire IT organization on a consistence level with a set of "soft standards" in place. This method also allow your IT organization to kept abreast with the changing nature to desktop technology. Here is where you will start to first see the benefit of "soft standards". New equipment coming into the institution will conform to the support team’s training. Faster repair and installation times will be demonstrated. Once you have established at workable set of "soft standards" that you institution can adopt, you must advertised them across the campus. Reference appendix C for the "soft standards" used at UT. If unknown to the university community they will never become widely adopted. The cost reduction benefit will only be realized when your institution starts to take advantage of your "soft standards".

Since the majority of Desktop computing training was being done by the local departmental expert. A series of class were developed to offer the university community access to help on utility tools and major application systems. However, to reach a wider audience a site license with vendor was executed to provide the entire campus computer base training material. Over 350 course title are offered. The faculty, staff, or student can access this material via the Web or on special production CD’s. With 30,000 potential users our cost per user is $1.98 and for LAN and CD-ROM users it is $15.65 each. This cost benefit per student makes another "soft standard" used to provide help and increase our productivity. The cost comparison between different instructional delivery methods is given in the chart #4 below. The CBT contract has been a win win situation for all involved. In the past we had purchased high quality training material for use by our professional computer staff… the license would prohibit student access. Our current contract does and we keep about 1,000 students registered (via the web) at any one time. To get this program kick started we provide the most popular courses on CD-ROM. As part of our "soft standards" FREE CD’s are provide the university community with anti virus protection software and some 32 CBT course. These courses include Microsoft office 97 products, Internet concepts, browsers, and HTML and JAVA development, Windows 95, Lotus Notes, and UNIX titles. These CD’s as dose the web site provide the student quick reference material source which starts to reduce the departmental experts one-on-one training time.

The following are some of the thing that your institution can do to reduce your training TCO element.

• Obtain a CBT contract for your institution that provides a large number of courses.

• Provide a variety of methods to allow skill upgrades like classroom, CBT, seminars, tips and trick session, and demos.
• Use CBT material as quick reference material via its online indexing.
• Offer course via the web to reach a wider audience.

• CD’s have been distributed for the past 3 years with courses material included.
• We have distributed CD’s with CBT material for our UT tool kit, Lotus Notes, and Microsoft Office at no cost to the student. Departments, faculty and staff members also participate.
• Special CBT course titles have been replicated for requesting instructor.

The Customer Services and Training group manages the CBT material and provide this faculty testimonial.

Making desktop computing part of the solution not part of the problem will require taking a closer look at the integrated systems and applications your institution is designing and deploying today. If you do not take into consideration the desktop computing components your costs may continue to rise. Application systems that are (1) hard to use, (2) not reliable, (3) not responsive to changing user requirements, (4) not networkable, (5) not able to integrate, and (6) isolated applications will cause your institutions TCO to continue to rise.

The keys to reducing the application TCO element cost are list below:

1. Simplify the profiles by selecting a campus "soft standard"
2. An industrial standard utility suite should be selected
3. Aggressively retire legacy systems

5. Automate the updates and distribution of software
6. Make new technology affordable

Aggressively retire legacy software: In 1994 UT list of support software packages had over 400 entries and was growing. Most of these software titles were older version or lesser-used applications. To reduce this volume a services level statement was generate for supported desktop application packages. Within the "soft Standard" statement three levels of software support were identified full support being the top, middle level support, and lower level support. Under the top level DII maintain an expert on that package (i.e. we staff a statistical support group using SPSS and SAS). The middle level allows DII to maintain an understanding of a package as to how to install and execute the package. Detail help the vendor must be consulted. The final or lower level "no" help could be obtained from DII however, non-DII departmental experts were identified and referenced. There was also "NO help" software grouping. We also adopted a current and two version back support level. Using these guidelines we aggressively eliminated hundreds of older legacy packages. This has allowed DII to concentrate on a limited number of software packages.

Industrial standard utility suite like Lotus Notes and Microsoft Office were selected as part of a "soft standard". These packages were made available to the university community at reduced prices. New technology is now being address by a wider number of the IT group because we have reduced or eliminated older and lesser-used application packages.

An automated software management and control system can now be reviewed, because our "soft standards" are being accepted across the campus. This will speed the repair time and troubleshooting time our support group experiences. It will also allow our institution to further reduce the number of support packages because; we could keep all desktops at a specified software version level. We could also maintain an application profile for faculty, staff, and students. This will also allow for an institutional automated asset control system.

The keys to improving and lowering the TCO maintenance and support element cost are as follow:

1. Establishing "soft standard" based on industrial standards.
2. Centralize and automate management and support.
3. Simplify the reporting and problem tracking procedures.
4. Identify and provide training for the departmental PC expert.
5. Develop a tracking system to measure improvements.

By purchasing equipment from our "soft standard" recommendation pool has made if possible for a small support staff to maintain a service level for the 12,000 desktop units on campus. With standard or "like" machines from our six vendors troubleshooting, warranty, and repair work are turned over quickly. We still run across a non-standard machine on the campus and we can now simply request that they replace it with one of our recommended new "soft Standard" unit. Departments with large number of desktop units has entered into service level agreements and stated expectation. These agreements are being replaced with on First Responders program (reference appendix F for details).

The "soft standard" we have been using on the campus for eight years now are starting to pay dividend. We can support the 12,000 units with a limited staff on 14 FTE’s to provide direct on-site desktop specialist. Since we are now seeing the same type of unit the answers and solution we provide are starting to be consistent.

An online database is maintaining records on all services calls to ensure that each problem is resolved and the entire group can learn from the repair call. Frequently asked question and repair problems can be resolved by searching the DII’s problem calls database.

Like the maintenance and support groups there are four keys to use in reducing you’re the environmental change TCO element, these are:

1. Establishing "soft standard" based on industrial standards
2. Centralize and automate management and support
3. Simplify the environment and limit the number of choices
4. Develop a tracking system to measure improvements

Since we have a five-year cycle for departmental connectivity or environmental upgrades. The modifications of "Network Interface Cards" and communication ports in each office or Lab should be held to a minimum. With each external change generally the desktop operating system will have to be changed. Major changes like switching from twisted pair copper or Coax cabling to fiber optic cabling should be done as to minimize the users effective operation. Because environmental changes will generally require users to start the re-training cycle. Installation of an automated management system to push or pull from a central location software and system changes should be your final goal. This is an expensive and disruptive process because departments may not want to give up the personal natural of their desktop units. However, using the pull process, which allows the end-user to determine when they update their personal environment helps reduce objections.

The keys to improving and lowering the TCO contractual technical support element cost are as follow:

1. Centralize the management and support of vendor contracts.
2. Limit the number of choices and contracts available.
3. Develop and advertisement methods to inform the institution of there existence.

While the need to expert level vendor or manufacturing based technical support is obvious. There should be a centralize group involved to getting these agreements at a favorable cost to the institution. The contract should be institutional-wide thru taking advantage of the economics of size. Larger agreements will allow for better utilization of the contracts. A central management method will allow your institution to start developing and deploying "soft standard" over time.

Limited choices and available contracts is a no brainier, you only need a single agreement to services a vendors product. Centralize control will afford your institution a monitoring process for your entire technology contract database. Also once an agreement is put in place the entire institution must be informed of its existence and how to take advantage of the contract.

www.cas.utk.edu ç push hardware or software button on left side. Over 400 software contracts and 12 hardware contracts.

Select Hardware for university recommended desktop computer configurations

Select Hardware for on-line desktop configurations and pricing

Select Software for access to our catalog and standard (stock) packages

www.cas.utk.edu/depts/pam ç Select About CALA for mission and TCO paper and a copy of this presentation.

www.tns.utk.edu/pc-support.html ç For desktop computing support and help.

www.cas.utk.edu/labs.html ç For labs locations, software, and hardware. 290 desktop units in 23 DII supported student labs.

www.cas.utk.edu/cbt ç For information on computer based training available from CAS.

www.tns.utk.edu/frp ç For information on UT’s first responder program.

www.cas.utk.edu/depts/pam/cala.html ç Our mission statement and copy of this paper.

Figure 5 – Author and Presenter

facility. I have worked on integrating microcomputer based manufacturing processes with a mainframe IMS ordering system, an on-line worldwide purchasing contracting and scrap material system, and a JIT material procurement system. I have also, established corporate information centers, and consolidated several data centers, systems, and programming staffs. I have also written and installed an inventory control and financial management microcomputer based system in Venezuela, Singapore, Adu Dahba, and 12 states. Established a microcomputer system development cost center at UT. My BS studies were in Engineering Computer and Information Science at Ohio State University, a mathematics from Purdue University, and additional studies in Computer Technology from Purdue University.

The recommended desktop configurations listed below are reviewed each quarter by a standing committee. General guidelines are updated and presented to the select list of vendors that have been pre-qualified to sell desktop computers on our campus. Vendor qualifications were determined by an open competitive bid process. The bids identified several desktop computer families of products. Vendors were asked to bid based on the published manufacturing retail price giving their offered discount percentage by product family. Bids were then awarded for the entire manufacturers product line.

The general guidelines are reviewed with the vendor on a quarterly cycle from which the vendors develop production schedules. The vendors are required to provide a 10-business day delivery schedule on all recommended desktop configurations. These configurations are our soft standards. Faculty, administrative and support staff, and students can purchase equipment on the recommended web site with a simple piece of paper and get delivery in less that 10 business days. For more detailed information on the ordering process and available computer configurations consult our web site at www.cas.utk.edu select hardware or software (buttons on the left side of the panel).

Listed below are some of our campus soft standards "recommended configuration" for desktop computers. There are six desktop manufactures displayed on our web site. The University of Tennessee community can pick from any of the six vendors.

Basic or entry-level desktop computer

333mhz Pentium II; 512K L2 cache; 32MB ram; 3.2GB hard drive; 24x CD-ROM; 3.5 floppy; 4MB AGP graphic accelerator video; 15" color monitor; 104 keyboard; mouse; 10/100 combination NIC; 5 open board bays; Intel LANDesk client manager; Windows 95; 3 year warranty

Intermediate level desktop computer

350mhz Pentium II; 512K L2 cache; 64MB ram; 4.2GB hard drive; 24x CD-ROM; 3.5 floppy; 4MB VROM AGP graphic accelerator video; 17" color monitor; 104 keyboard; mouse; 10/100 combination NIC; 5 open board bays; Intel LANDesk client manager; Windows 95; and 3 year warranty

Multimedia level desktop computer

400mhz Pentium II; 512K L2 cache; 128MB ram; 6.4GB hard drive; 32x CD-ROM; 3.5 floppy; 8MB VROM AGP graphic accelerator video; 19" color monitor; 101 keyboard; mouse; 10/100 combination NIC; Iomega Zip drive; 64bit integrated sound card; Acoustics speakers; Intel LANDesk client manager; Windows 98 or NT; and 3 year warranty

Power level desktop computer

400mhz Pentium II; 512K L2 cache; 128MB ram; 8GB hard drive; 32x CD-ROM; 3.5 floppy; 8MB VROM AGP graphic accelerator video; 19" color monitor; 101 keyboard; mouse; 10/100 combination NIC; Iomega Zip drive; 64bit integrated sound card; Windows 98 or NT; Intel LANDesk client manager; Windows 98 or NT; and 3 year warranty

The four levels: basic, intermediate, multimedia, and power represent the buying patterns on our campus. Where the basic-level is designed for the heavy data entry clerical position on the lower side of the scale. Intermediate units fill the needs for developers, administrators, faculty, and student computer labs. The multimedia computers are configured to support the individual that is developing or researching full motion video courses or projects. The power level is designed for the researcher who needs the most powerful computer available. The configurations in these levels are made so that they will more than just fit the needs of each group. The vendors very aggressively price these groups to generate sales. Our campus support personnel are involved in the guideline compiling so they will be prepared to support the equipment when it is installed. We also communicate with the manufacturers our special campus needs to insure compatibility with our computing environment. Specifically, the Network Interface Card (NIC) is an example of the cooperation and partnerships we have developed.

www.Intel.com/managedpc/tco/index.htm

www.cio.archive/090197_Meta_Content.html

www.ome1.com/WhyOme.HTML

www.zdnet.co.uk/pcmag/analysis/tco.html

techweb.cmp.com/iw/620/20iucos.htm

www.eu.microsoft/topics/tco/default.htm

costless.compaq.co.uk/survey/survey.html

pubsys.cmp.com/epc/news/3-10-a.htm

www.jdapsi.com/tco.htm

www.bosscorp.com/TCO.html

Escalating costs for selection, acquisition, and delivery of desktop computing become a problem in the enterprise because each purchase was consider as a stand-alone transaction. The bidding process for an individual department can take from 6 weeks to 6 months to complete. The $5,260 cost for a $2,500 desktop unit result when each unit purchase must go through a bid process. This usually includes cost of the personnel involved in the selection process, the specification development process, the bidding process, the acquisition, and the delivery . Using an average standard rate of $23.00 per hour for all the personnel involved in the acquisition process we computed a cost of $1,932. This is based on a total of 84 hours split over requestor 60 hours, local consultant 4 hours, business office 6 hours, accounting office 6 hours, purchasing office 8 hours. Plus an $828 cost to process a bid. Consider 2,000 – 4,000 purchase in a year was costing the institution an extra $5,520,000 - $10,800,000 to acquire the units in 1990.

Desktop computing is supported by the Division of Information Infrastructure (DII) using several methods. Five different initiatives cover the campus. Also two additional non-DII support functions are provided on the campus. Within DII’s the five initiatives the following services are performed: customer service centers, student computer labs, purchasing control function, telephone support line function, web based information services, consulting services, computer based training, and LAN and Desktop troubleshooting function.

We found local departmental desktop computing expert is almost every area on the campus. In an attempt to get these local experts to understand what "soft standards" are available to them through DII a series of training classes are offered. This program is called the First Responders program conducted by our Lab and Desktop Support group. When counted we found 125 full time employees involved in some type of desktop support. Since we could not get an accurate percent of effort we are using their entire salary in the about table. Also a benefit percentage of 46% was used in the calculation. This yields a $6.7 million campus-wide labor support budget to cover the 12,000 desktop units on this campus. The $588.33 of TCO element cost added can be reduced with better involvement percentage from un-DII local departmental experts.