What’s in it for me? Featured

7:00pm EDT December 26, 2008

Contracting with an independent service organization (ISO) after the warranties expire on your data center equipment is cost-effective, provides ease of doing business and can save you a great deal of money, often within one or two years.

As anyone who has ever managed an IT department well knows, managing the warranty expiration dates on numerous pieces of equipment and tracking service is a never-ending juggling act. The ability to quickly access the right parts for equipment when necessary is another big challenge.

“The right ISO can be a valued business partner,” says Leo Vigeant, vice president of business development at Park Place International. “But the key is to find an ISO that delivers on their promises. Once you’ve verified references and entered into a relationship, you can look forward to numerous benefits as you begin to work together.”

Smart Business asked Vigeant to explain those benefits and how they differ from the extended services offered from OEMs.

Can an ISO help an IT department become better organized?

Definitely. With constant upgrades, changes and replacements, it’s easy to lose track of hardware revisions, spare parts inventories, warranty agreements and billing procedures. An ISO will conduct an audit to determine what equipment is still under warranty, which warranties are about to expire and whether there are any existing problems. The ISO will provide an inventory report, notify you when warranties are about to expire and advise when it’s time to replace equipment. The ISO often finds a lot of equipment that has fallen off contract and will help you determine what to do next. When a service program is implemented, the ISO will provide asset management and maintenance reports on all devices and equipment covered. In addition to helping with organization, this provides a single point of contact — no more managing multiple OEMs.

In what other ways will having a single point of contact help?

The ISO’s engineers get to know your equipment and can study historical reports to identify trends in a piece of equipment and recommend any upgrades or changes. Having a single point of contact is beneficial not only from a service/delivery standpoint but also in terms of billing and contracts. OEMs sell you an annual contract, whereas, an ISO often can be flexible, allowing you to add and delete items, and provide you with a 12-month outlook so you’ll always know where you are financially.

Can working with an ISO help me extend the useful life of my equipment?

Certainly. The OEM wants you to buy new equipment; the ISO’s goal is to give you options. If you want to end the equipment’s life at two or three years, fine. If you want to try to extend it 15 years, the ISO will help you work toward that goal. If you contract with an ISO versus on OEM to provide service, at 40 to 55 percent less than what an OEM would charge, the savings you’ll achieve by extending the equipment’s life even one or two years will be substantial.

Will the ISO be able to quickly locate the parts I need?

Having the right parts at the right place at the right time is critical. Oftentimes, OEMs take longer to access parts than ISOs, frequently having to fly or drive them in. Evaluate any potential ISO’s plan for spare parts. Does it have a logistics team that will analyze each piece of equipment in your facility to determine what specific parts you need to have on hand? Will it store the parts locally and at your site? If you want even more parts available for your own comfort level, will it accommodate you? The bottom line is that you should know exactly what parts are important to your data center and exactly where they are at all times.

How can working with an ISO help contain potential catastrophic costs of downtime?

Quality ISOs have highly skilled and trained engineers who develop close relationships with customers and who really get to know each piece of equipment. That knowledge, along with a strong parts program, helps you stay up and running and, when problems do occur, to solve them quickly. ISOs are in the service business — it is critical for them to make sure downtime doesn’t occur. This is an important consideration for companies that try to maintain equipment in-house. If something happens, you’re going to need specialized knowledge and parts. And some parts can cost five to 10 times more than a service agreement. In the end, it only takes one serious failure to bring a business to its knees.

How can working with an ISO help with future needs?

Once you select an ISO and get comfortable with its staff, trust develops. Eventually, you’ll turn to them with questions, such as, ‘How can I migrate? What can I do to extend the life of this piece of equipment? What systems should we go to next?’ The ISO is not in the product business. Any recommendations it makes are to help the client. The ISO lets the clients make their own decisions, when they want to, within their budgets.

LEO VIGEANT is vice president of business development for Park Place International. Reach him at (800) 931-3366 or Leo_Vigeant@parkplaceintl.com.