Do you know how much your business spent on IT systems and services last year? On the surface, it seems like a relatively simple question to answer. You know what you're paying your internal IT guy, or know you could pull invoices from the third party support company you call on. But the reality is that most small-medium-sized business (SMB) owners have no idea how much money they are truly investing in IT each month. How is this possible? Very few business leaders account for total cost of ownership (TCO). TCO is defined as all of the possible costs involved in the purchase, installation, management, support and use of the IT infrastructure within an organization throughout a product's lifecycle, from acquisition to disposal.

TCO includes both hard and soft costs of owning technology systems. There are several tangible and identifiable hard costs such as: wiring infrastructure, data networking systems, the purchase of hardware and software, telephone and voicemail, security systems, maintenance contracts, support contracts, and direct labor. And please note, the purchase of new hardware is the least costly expense of owning the equipment. The cost to properly maintain, secure, update, and backup the machine will easily dwarf the expense of the physical equipment.

Most SMBs do a decent job identifying the hard costs of IT, but they tend to quickly lose account of their IT spend by overlooking their soft costs. The soft costs include systems administration, help desk calls, staff development and training, unforeseen repairs and service calls, configuration management, and the most significant cost of all...downtime. While each of these soft costs is very real and can turn your business upside down in a hurry, they are not incurred at the time of acquisition of hardware or software and are often disregarded. Neglecting to acknowledge TCO will lead to unexpected budget increases, and give business leaders a false impression of what reliable IT truly costs.

Now that you're thinking about how much money your business actually invests in IT, you probably want to know how to reduce the TCO of your IT systems. While there is no single item that can be removed to substantially reduce your TCO, the majority of costs involve the ongoing support and maintenance of computers and networks. A great first step would be creating a formalized IT budget, instead of ad-hoc spending. According to Gartner, 60 percent of SMBs will increase IT spending by more than 5% in 2011 to become more efficient and to eliminate business risk. Before you invest additional dollars on IT, sit down and figure what you're currently spending.

If you don't want to deal with the headache of planning and budgeting for IT, seek out a trusted IT advisor who will work to ensure your IT dollars are bringing value to your organization. Guidant Partners would appreciate the opportunity to meet with you and discuss your IT initiatives for 2011. We deliver a Flat Fee IT solution to our clients that allows for precise budgeting, and we eliminate unexpected fees. We provide hardware, software licenses, installation, training, support, infrastructure, monitoring, updates, security, data backup, and on-going maintenance for a flat monthly fee. We will show you the most cost effective way to manage your IT infrastructure.

Keeping up with how much you actually spend on IT can be very cumbersome. If you would like an easily budgeted IT solution, please call Guidant Partners at 615-277-3361 or send an email through our online portal at www.guidantpartners.com.