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Consumption Model: ‘De-Horning’ Major IT Dilemmas

Posted by Stephen Mease on Jun 25, 2018 5:00:00 PM


I’ve always considered the expression ‘horns of a dilemma’ a fitting description for the frustration and sense of helplessness one experiences when faced with a seemingly insurmountable, no-win situation. It definitely applies to the way many enterprises feel when they’re forced to respond to the rapid changes in technology and in the marketplace. Some sources driving the frustration involve how to:

  • Implement IoT without adding staff or skills
  • Rely on proven solutions
  • Keep control
  • Scale and innovate
  • Pay as you go
  • Align investments with returns
  • Minimize security exposure

Here are some examples:

To Scale or Not to Scale – That Is the Question

I bet if William Shakespeare were living today, this is the question he’d be asking. Overbuy in anticipation of, or face the potential of a lack of capacity in the future. The rate of change in the market makes long-term planning difficult. Overcapacity results in excess capital being used on idle/unused storage and servers. Making matters worse is the possibility that future technology advancements could make what was just purchased obsolete before the business needs are utilized at full capacity or fulfill the duty lifecycle.

Purchase too little and you risk not being able to meet business demands down the road. According to 451 Research, a whopping 50 percent of enterprises have suffered downtime as a result of poor capacity planning. Remember, adding capacity often requires going through a lengthy purchasing process. What happens if demand drops again in response to another change once you’ve added the new capacity? The same 451 Research states enterprises over-provision compute capacity by an average of 59 percent and storage capacity by 48 percent, resulting in wasted capital that could’ve been better used on other business requirements.

Runaway Spending

Each change seems to introduce new technology solutions. The good news is most solutions serve needs beyond helping you manage the change. They actually enhance your ability to succeed and compete. However—and thus the dilemma—financially, should you acquire every new solution that becomes available? Then again, can you afford not to? Buying provides you access to the best, most efficient and thorough tools for analytics, cloud, IoT, mobility, etc. However, this path may also walk you right off a financial cliff. You may have all the ‘latest and greatest’ but your business is on the brink of insolvency because you spent all your cash.

Conversely, failing to maintain your IT infrastructure will render your business uncompetitive thus losing valuable market share to your competition and no longer delivering what customers expect. This is certainly no solution, but a reality, as some major retailers have recently discovered.

No Waste, No Worry and No Dilemma: ‘De-Horning’ With the IT Consumption Model

IT Consumption Models turn the ‘no-win’ situation into a ‘win-win’ situation.

In terms of acquisition, these models allow you to acquire new technology as operational expenses (OpEx) vs. capital expenditures (CapEx). They also eliminate the lengthy process associated with purchasing additional technology by making more capacity instantly available as part of the consumption agreement. IT Consumption Models also eliminate the risk of acquiring too much or too little capacity. They provide the ability to provision what you need while only paying for what you actually use – over and above a basic charge. IT Consumption Models are a flexible, sensible way to acquire and consume the technology you need to thrive in the face of rapidly-changing realities. It’s accelerated outcomes on your terms.

Tech Data connects the world with the power of technology. Our end-to-end portfolio of products, services and solutions, as well as expertise in next-generation technologies can help you determine the IT Consumption Model that meets your business’ needs.

About the Author

Stephen Mease
Supplier Business Executive, HPE Pointnext Services, Tech Data

Tags: IoT, Information Technology, OpEx vs. CapEx IT, Enterprise Techology, IT Consumption Models