Total cost of ownership (TCO) refers to the hidden costs of a new technology. Total value of ownership (TVO) is the flip side of TCO and refers to the hidden benefits. Following are a few questions you can ask yourself to help uncover these hidden costs and benefits. However, this list is only partial. For more considerations, check out our additional resources:
Total cost of ownership questions
- IT staff support: How much time will your IT staff spend supporting and maintaining the new technology?
- Vendor fees: Will you be paying any ongoing support or licensing fees to the vendor?
- IT training: For any complex technology, your IT staff will need ongoing training. They might need formal classroom training, or they might make do with books, websites and advice from colleagues. However, whatever technique they choose, they’ll need paid time to absorb the new knowledge.
- Staff training: Any time you replace a major productivity tool, such as your ILS or your Microsoft Office productivity suite, staff will request some formal or informal training.
- Bandwidth costs: Will you need a faster Internet Connection to handle the new technology? For instance, if you begin a project to digitize local history resources and put them online, and you include high-quality photos and streaming audio files of interviews with residents, will your connection be able to handle the traffic? Certain applications will also increase the traffic between branches, so you might need to upgrade your wide area network connections.
- Hardware costs: Does the software you’re considering require new hardware? For example, a lot of enterprise-class technologies run best on dedicated servers or single-purpose hardware appliances. Even if you have an unused server in your library, is it compatible with the new software?
- Infrastructure costs: Computers need electricity, and they have needs in terms of temperature and humidity. Will a new technology initiative require that you upgrade your HVAC system? Will you need more electrical outlets? Will you need a new electrical panel? Will you need more network drops, more patch panels or more switches?
- Electricity costs: If you’re running more desktop and laptop computers, you’ll be paying more each month for electricity. Servers also use electricity, but they might have additional costs related to maintaining stable temperature and humidity.
- Technology replacement: How long will it be before you need to replace this technology, and how much will it cost?
Total value of ownership questions: You can turn any of the previous questions on their head and ask yourself what the benefits and savings of this new technology are?
- Service to patrons: It’s hard to measure the impact that a new technology will have on patrons, but it’s obviously a primary consideration that can easily outweigh all the other factors on this list.
- Library visibility: Some technologies generate excitement and publicity. For example, video game events are still controversial in some quarters, but journalists like to write about them. On the other hand, your new disk-cloning software probably won’t get a write-up in the local paper.
- Staff productivity: Will library staff be able to do their jobs faster with the new system you’re considering? If you’re tracking your income and expenses using a clunky, ten-year-old piece of software, could you save time in the long run by upgrading? How many extra steps and unnecessary workarounds does your staff use to deal with the quirks and limitations of your ILS software?
- IT staff support: If a new technology is more reliable and user-friendly than the solution you have in place, your staff will spend less time fixing problems and answering support calls.
- IT training: Again, more reliable, user-friendly software may reduce the amount of time your IT staff spends trying to learn the intricacies of the technology.
- Staff training: Ditto. User-friendly technology means less staff training.
- Hardware costs: It may sound counterintuitive, but some technologies can reduce your long-term hardware costs. For example, you may be running a technology in your library that requires its own piece of hardware, while the replacement option you’re considering is happy to run alongside other programs on a shared device. If you run a lot of server-based programs that all require their own dedicated hardware, virtualization software might let you consolidate those applications and run them all on the same server without any conflicts. Thin client solutions such as Userful Desktop can also reduce the amount of hardware in your library.
- Infrastructure costs: Again, any technology that reduces the amount of hardware in your library (see the previous item) might lower your long-term infrastructure costs by reducing the number of electrical outlets and network drops that you need.
- Electricity costs: Is the new technology you’re looking at more energy-efficient? For example, LCD monitors use much less electricity than older CRT monitors, and computer manufacturers are making strides in terms of reducing the energy consumption of their products. Also, anything that reduces the total number of PCs and servers in your library will probably reduce electrical costs as well.
- Bandwidth costs: Some vendors are more conscientious than others when it comes to conserving precious bandwidth. In other words, the software you’re looking at may use less bandwidth than your existing solution and could, therefore, save you money. Bandwidth management tools are specifically designed to reduce your bandwidth usage.
What additional TCO questions should you be asking about your specific technology purchases?