IT Gets Its Thrift On

IT Gets Its Thrift On

Reduce, reuse. Recent economic realities are making a virtue of necessity for many in IT, as we are forced to put the brakes on planned refresh projects and extend the lifecycle of legacy assets yet further. The cost of delayed obsolescence? Less than nothing -- people are still productive, and the savings have multiplied like rabbits.

Our efforts to cut back in tough times have revealed just how strategic old-fashioned virtues can be in the digital age; thrift is the new, new (sustainable) thing.

Like many of its users, today's aging hardware is more vigorous than in times past. Most software will run quite nicely on a five-year-old machine. Equipment is substantially more reliable than years ago, so out-of-warranty repair costs are manageable. And the growth of software-as-a-service (SaaS) has turned many PCs into little more than Internet terminals. Most important to the business, extending the lifecycle of capable legacy assets will substantially reduce total cost of ownership (TCO).

Although end-of-life residual value falls with increasing age, the TCO savings accrue faster than the loss of fair market value. For example, for every thousand dollars in original procurement cost, extending an asset's life from three to five years will save nearly $700 in net total costs, on average. However, the requirement for capturing such significant TCO savings is simple, but not easy: keep the end users happy with the old stuff when their first impulse is to ask for a shiny new one.

User acceptance is initially a question of cosmetics and presentation. Touch points such as mice and keyboards show visible wear after a few years, and should be replaced whenever hardware is refurbished. The Sharpie inscribed telephone number of the last user's girlfriend must be removed, likewise the gum and coffee stains. Major blemishes such as cracked plastic can be repaired, and paint touched up. Finally, equipment must be packaged to preserve its newly minted, refurbished condition, and to provide the end user with a credible "new" device experience.

It is no coincidence that non-refurbished, grungy machines in perfect operating condition will fail at a much higher rate than cosmetically restored devices. Users always get what they want -- one way or another.
If first impressions are good, users will embrace the positive environmental impact of longer lifecycles when it is proactively and quantitatively communicated. Because as much as 80 percent of a computer's lifetime energy use is consumed during when it is manufactured, deferring the purchase of a new one yields substantial environmental benefits.

Reusing one desktop computer and display reduces carbon emissions equivalent to removing a passenger car from the road for six months. One large bank that redeployed more than 10,000 devices in an 18-month period saved enough electricity to power nearly 35,000 homes for a year. When people understand the contribution using refurbished equipment can make to their company's sustainability, they will dig it. Tell them.

Besides electricity, the aforementioned bank also saved more than $9 million compared to buying new equipment. Even people who would never hug a tree can get their arms around that.

The same benefits that motivate reuse of legacy equipment also add up when buying refurbished gear instead of new. In a 2008 IDC survey, nearly 75 percent of respondents reported buying refurbished PCs, servers, storage, and peripherals. Such purchases are often used to supplement redeployment stocks and for projects.

Though IDC reports the decisions are made for financial reasons, the unintended consequences are substantial savings in carbon emissions and raw materials extraction. Since virtually every large company has some sort of green initiative, quantifying and reporting the sustainability impact of buying used will only improve the argument in favor of legacy equipment. For the people involved, it may help improve the sustainability of their careers as well.

In a Georgia Institute of Technology paper on the refurbished equipment market, Ravi Subramanian reports that, based on quality and perceived value for the price, most buyers of refurbished computers are more satisfied with their purchases than buyers of new ones.

While a properly refurbished machine can indeed be more reliable initially than a new one, producing a consistently high-quality product is not trivial technically or operationally. Buying from an experienced refurbisher is important, and understanding the terms of sale, including warranty, is critical to finding happiness with an older machine.

Information technology is a necessity – and an expensive one -- both financially and environmentally. Until recently, it has epitomized an economy built on consumption and obsolescence. The Great Recession has realigned the thinking of many IT professionals from "feeds and speeds" to needs. Both Chief Financial and Environmental Officers have always appreciated thrift, and the sustainability that comes with it. When CIOs follow suit, even in the toughest of times, we are making progress.

Robert Houghton is President of Redemtech, a leading asset recovery company and Microsoft Authorized Refurbisher that produces the Red Rabbitt brand of refurbished equipment for business and personal use.