TCO

    TCO (Total Cost of Ownership) is defined as all of the possible costs involved in the purchase, installation, management, support and use of the IS infrastructure within an organization throughout its life cycle, from acquisition to disposal. Acquisition makes up only 20 - 25% of the TCO on a PC. The rest is made up of tech support, end user support and training, asset management, disposal, playing with technology (Futz Factor), and peer support ("Hey Joe" support). Depending on the methodology used, studies indicate the total cost of ownership for a single desktop computer in a distributed computing environment range from $7,000 to $13,000 per year.

    The Futz factor: Wasting time “futzing” (definition: To waste time or effort on frivolities; fool) around with new technology. A report from Software Business Technology (SBT) of Sausalito, California, which found that staff spent 5.1 hours each week "futzing" with computers. Add it up, and North American business was futzing away about 5 billion hours a year at a cost of $100 billion. Over the course of a decade, there's the missing trillion dollars. What is the futz factor, you say? It's simple - it is the tendency where people end up wasting a lot of time learning about computers or waiting for their computer to do something. It is time spent solving the little, mundane problems that occur day-to-day as they struggle to master their machines -- such as not being able to get a document to print.

    Lack of affordable, skilled IT personnel: According to a business-IT alignment study of 154 companies conducted by Cutter Consortium, a large percentage of companies, 29%, cite hiring difficulties as the greatest factor in their decision to outsource. Microsoft reports a skilled labor shortage among its Microsoft Solution Providers channel of 17,000 technical jobs in North America and 40,000 jobs worldwide. The Information Technology Association of America estimates the shortage at 190,000 unfilled IT jobs – not counting government and non-profit organizations. One-third of ITAA members reported they are recruiting IT workers on a full time basis and 68% say they are concerned that this skill shortage will become a barrier to growth.

    Peer Support or "Hey Joe" support: A coworker gives informal assistance to resolve technical problems. "Hey, Joe" support is particularly expensive, because if Joe does not know the answer, other coworkers could be drawn into the discussion making three of four people unproductive.

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