Cost always plays a big part in purchase decisions. It’s certainly a factor as I consider buying a new car. As you’re well aware, purchasing a new car isn’t just about the initial cost. In my case, I’m considering reliability, speed (not that I need to go that fast carpooling my kids to school), mileage, and looks to a certain extent. (I just can’t bring myself to drive a minivan.) But what does buying a car have to do with your customers, or IT spending for that matter?
To put it simply, customers often cite initial cost as a big factor in their network decision-making, too. But if they are looking only at CapEx when purchasing new equipment, it’s the same thing as only looking at the initial cost of a car: They’re not seeing the entire picture.
Total cost of ownership, or TCO, is a better metric to assess network cost, because it considers the full impact on IT spend, including CapEx, services, labor, bandwidth, and energy consumption. And TCO is not just a measure of the initial expense, but of how much equipment will cost over its lifetime.
In June 2011, Cisco commissioned a third-party business consulting firm to analyze the true TCO of the network, comparing the quantitative costs of acquisition, support, labor, bandwidth, energy, and product longevity. The firm also assessed qualitative business benefits like network uptime, user productivity, and security.
The quantitative results alone show that a network built on Cisco’s architectural approach can yield up to a 13% better TCO, building a powerful business case for you to take to your customers about why the choice of networking gear matters.
Here are some facts drawn from the findings, which support Cisco’s firm belief that a strategic next-generation Cisco network architecture delivers superior value and lower TCO: Read More »