Buying power Featured

12:01pm EDT March 11, 2004
Slow computers mean slow productivity, so upgrades are a common business practice.

Key Bank has put its upgrade process onto a regular schedule to maximize its buying power and reduce support costs.

"Prior to 2002, the lines of business within the bank bought their own PCs," says Jeffrey Glover, vice president of Key. "The managers would put a budget together and buy what they needed."

Standards were set by the technology group as to what types of computers and software could be purchased, but each line was replacing machines independently.

"We had profitable lines getting new PCs every 18 months or two years, while other lines that were basically not profit centers would get hand-me-down PCs or wouldn't get them at all," Glover says. "Lines of business in the middle might get them if they had a good year; if not, they would have to keep what they had."

All these independent decisions meant some departments had machines running outdated operating systems with processors that were slow by today's standards.

"We determined that if we centralized the budget within the technology group and could forecast replacing the computers, we could save money," says Glover. "We are doing it on a three-year cycle, replacing one-third of the computers each year. By the end of the year, we will have replaced approximately 18,000 computers, and the oldest one will only be three years old. Everyone will be on a newer operating system - either Windows 2000 or XP."

By buying computers in bulk, Key is able to leverage buying power to save on purchasing costs, but the program has also made support personnel more efficient.

"We can roll out applications easier," says Glover. "We don't have to worry about a department having six-year-old computers that are not compatible. It's easier to support the applications, and we did some things with the security features of the newer operating systems that weren't available on Windows 95.

"In 2003, we saved $800,000. What's not factored in are the lower support calls. Our number of calls has gone down. Productivity has increased. Instead of working on a junky 200 megahertz PC, someone is now working on a 2 gigahertz PC. They are working faster and better."

The biggest challenge in rolling out the program was convincing managers who had been in charge of purchasing computers to give up that authority to the technology group.

"They were a little apprehensive at first," says Glover. "It was more of a trust factor than anything. People with bigger PC budgets wanted to keep that within their department, and even in other areas with smaller budgets, they didn't want their work to be disrupted by the upgrades."

An internal Web site was set up that contained frequently asked questions about the program and explained how it would benefit everyone and how it would be implemented.

There was also an e-mail address and phone number for employees to use to get questions answered.

"The biggest question was, 'When do I get my new PC?'" says Glover.

Even though some employees didn't necessarily need the computing speed to do their jobs, Glover says the upgrades were still important.

"It's hard to gauge what applications they might need in a few years," he says. "We need to keep pace with the marketplace. The new Microsoft Office or OS won't run on older machines." How to reach: Key Bank, (800) 600-2680


PC planning

Replacing 6,000 computers a year isn't something you can take lightly.

Key Bank has implemented a PC procurement program that replaces one-third of the company's computers each year. To further complicate matters, throw in 906 branches scattered across 12 states, and you have the potential for a logistical nightmare.

And that doesn't even take into account the fact that some lines of business within the bank only have a handful of computers, while others have thousands that need replacing at one time.

"Planning is really huge," says Jeffrey Glover, vice president of Key. "We have to really plot out our strategy. We've gotten off to a slow start each year and haven't really replaced a lot of computers in January and February. The reason for that is we spend a lot of time planning out the next six to nine months. Once we get the process rolling, it goes really smooth."

Most of the planning focuses on the replacement schedule.

"It's based on a combination of line of business and geography," says Glover. "We might go to a remote office and replace all the PCs there over the course of a couple of days and evenings. For the larger offices here in Cleveland, like the operations center in Brooklyn, we'll be replacing PCs throughout the year.

"For the bigger offices, we might focus more by line of business. Whenever we can, we replace PCs to coincide with any new applications they may be getting this year."