In a world where taxis are not owned by taxi companies and hotels are not owned by hotel groups, it may be no surprise that, when it comes to acquiring PCs and related hardware, we’re moving away from buying such transient assets and towards subscribing to them via outcome-focused services. Finance Director Europe speaks to Dave Roberts, EMEA sales vice-president for Dell Financial Services to find out more.
Buying outcomes through a service model is not a new phenomenon. In the aerospace industry, airlines have been buying flying hours instead of engines for over 50 years. In the 1990s, the software-as-a-service (SaaS) revolution meant that users were paying a subscription for consistent application capability instead of software discs that they had to install themselves. SaaS vendors took responsibility for upgrades and security through a centrally managed software experience, accessible via the internet.
Hardware and related services are the latest such solution, known as PC-as-a-service (PCaaS). With PCaaS, hardware and services are bundled into a single subscription, for which companies pay a monthly fee rather than buying or leasing assets outright. This means that IT departments get hold of the latest technology without the responsibilities of maintenance, security and disposal. A distinguishing aspect of PCaaS is its approach to asset lifecycle management, which includes centralising the acquisition, deployment, configuration, management and retirement of computer hardware into one package on a price-per-seat basis. This allows straightforward scaling up or reduction of a firm’s commitment to IT spending, especially in times of increased pressure on the IT department’s budget.
In a recent study by the International Data Corporation (IDC), over half of PCaaS agreements included help/service desk (24/7 phone support), secure disposal, advance swap/ replacement, data storage services and break/fix onsite with a service-level agreement. As a result of this commitment to service, PCaaS scored high among early adopters, according to IDC, with 93% of those surveyed declaring they are ‘very satisfied’ or ‘somewhat satisfied’ with the service.
According to Dave Roberts, EMEA sales vice-president for Dell Financial Services (DFS) – one of the leading players in the IT financing space – PCaaS enables the buyer to move PC procurement from capex to opex and, at the same time, benefit from faster refresh rates. This means employees can work with the latest technology, with positive effects on their morale and productivity.
“Just keeping track of these devices, let alone repairing them in a steady and efficient manner, is a hard task for IT departments,” explains Roberts. Purchasing the latest devices is also a drain on a company’s capex. As such, buying new computers is often shunted to the bottom of the to-do list. “If you think about clients that have multiple devices on the same sites, then at different sites, and then over multiple regions on different terms, it becomes impossible to manage,” he says.
“Think about the environment that IT buyers operate in – they’re having to grapple with things like the cloud, big data and the internet of things,” says Roberts. “And the role of the IT department is becoming more complicated. It has really gone from being a cost centre to a service centre, to an innovation centre. They’re having to do more with less.
“We’re also seeing a shift in how customers source their IT infrastructure. It’s gone from being a purchase system funded by traditional finance to a service model. And we’re seeing that because of a big explosion in devices.”
The need for refresh speed
One of the key unique selling propositions for PCaaS is the speed of refresh. Current-generation PCs are critical to the productivity and competitiveness of any business, but typically, hardware refresh is often extended well beyond its due date, as IT departments’ resources are stretched or diverted to more urgent, business-critical projects. According to IDC, ageing desktops and laptops typically cost more to maintain, particularly in IT support costs, which rise sharply between years three and four.
Outdated hardware and operating systems are a major source of not only lost productivity but also employee dissatisfaction – especially among millennials, 42% of whom claim they would leave a job if their employer provided substandard technology. According to IDC, satisfaction among early PCaaS adopters in Europe is strong, with over 50% of companies that had a PCaaS agreement able to refresh their assets a year earlier than they otherwise would have.
Security and data protection
Refreshing assets through life-cycle management also helps mitigate the risk of cyberattacks. In May this year, the WannaCry cyberattack specifically affected users who were running Microsoft XP, a retired operating system. With PCaaS, operating systems are upgraded and made secure with what DFS calls “vendor-grade security”. In addition to mitigating cyberthreats, PCaaS helps protect data from leaking to undesirable parties.
“Secure disposal of retired devices and the data stored on them is also an attractive proposition of PCaaS agreements, as old PCs containing company data are often just stored in a drawer,” explains Roberts. “PCaaS guarantees companies that their devices are properly retired and wiped of sensitive data without needing to allocate budget to disposal.”
PCaaS offers end-to-end life-cycle management of PCs. The burden of procurement, delivery, onboarding and disposal is all moved away from the overworked IT department and on to the supplier.
The as-a-service solution manages the assets in a low-cost model while providing security during the primary asset life and end of life cycle. The solution provides incremental employee satisfaction at a time when staff are the key assets of all businesses.