Top IT deployments

Top IT deployments

For most companies, having computers and basic software applications is all you need to be called an IT savvy company. Hence the deployments of enterprise applications are relatively lower in such organisations. By Varun Aggarwal

Small organisations have spent quite a lot on IT in the last year. Considering the fact that about Rs 60 lakhs was spent on an average on IT in the last year, the realisation of the importance of IT is quite evident. What’s even more interesting is that the fact that most of these companies completed their IT projects within their stipulated budget (78 percent). Only 17 percent organisations exceeded their budgets while deploying their most significant project. Small businesses keep a close watch on all their IT expenditure, so they are able to maintain their budgets for any given project.

The budgets exceeded in most of the cases due to the increase in the prices of various products and services. As mentioned earlier, many companies do not maintain an IT budget, which also led to the increase in the final cost of the implementation vis-a-vis what was expected. 35 percent of organisations that overshot their projections underestimated their IT budgets.

Impact of the deployment

The obvious assumption when one makes before investing into an IT project, is that it would help in improving the productivity of the company. However, one should take due care not to invest into things that are not required. For example, getting unnecessary software updates when the older versions are doing the needful. In such a case, one can end up increasing the hardware costs as newer versions have higher hardware requirements. Thus you end up spending more on the hardware, to avail some free updates which you seldom use.

Different industry verticals have their own reasons to invest in IT projects. While most verticals went for their most significant deployments to ensure faster delivery of products and services, the chemical & pharmaceuticals sector was looking to streamline processes. While FMCG, being more focussed on better integration with their suppliers and markets, some also went for the deployment in order to cut costs.

Nanco Hoisery Mills deployed new ERP packages focussed on products. They strongly believe that with this deployment, they will be able to gain in production activities, making these more efficient and productive. They will also look at virtualisation and hope to speed up applications with this deployment.

Desktops lead the way

This year desktops remained the top priority for small businesses. Most of these organisations spent heavily on desktops making this product category the largest IT infrastructure investment for 2006. Desktops as we also saw last year remain most important for small enterprises. Since these companies are realising the importance of IT, this is seen as the first step towards automation.

Though the desktop prices have come down significantly, the average cost per desktop hasn’t dipped. This is due to the fact that companies are opting for LCD monitors rather than the conventional CRTs. While CRTs have been a preferred choice all along, the dropping prices of LCDs and improved features and benefits of the same are bringing about a change.

The prices of RAM shot up with the high demand for RAM upgrades with the launch of Windows Vista. However, now they are quite stable and the prices are again dipping. People who bought their desktops while the prices were high, obviously had to shell out more and thus exceeding their budgets.

As the penetration of servers is on the rise in the small business segment, the preference is for thin clients, which would cost you lesser than Rs 10,000 per client in some cases. Thin clients are not only cost-effective but they also ensure better security, since there are no hard disks in these devices.

In case a company has a small IT team which can handle desktop maintenance, buying assembled desktops can work out to be a better deal. However, the price difference between branded and assembled desktops is not too large any more and thus if you want to get rid of the maintenance worries, going for branded desktops could be better.

Printers

The quality and speed of laser printers have prompted people to shift away from dot matrix printers. Though they haven’t dumped their old dot matrix printers, most organisations are eyeing laser technology as their best bet while buying new printers. The decreasing costs of laser printers have made them more cost-effective although dot matrix printers continue to have an advantage when it comes to cost of operation.

Laser printers were perceived to be very expensive high quality printers, usually bought for very specific tasks. However, with the decreasing cost of ownership of these printers, they are gaining market share. Along with the dipping cost of the printers, the after sales services have also become cheaper as these devices become common. Although printing costs are higher than in the case of dot matrix, it still remains lower than that of inkjets. Harshal Pandya, IT manager, ETV Gujrat chose to go with two HP laser printers as he feels that laser printers are economical and offer better quality printing.

One should be careful before buying a printer as there are printers available in the market for specific needs. For e.g. in case you need to buy a colour printer and the colour print requirements are not very high, opting for a multi-function device or MFD may work out. However, these might turn out to be a costly proposition if you’re looking at a high print volume. Thus, consulting different vendors before buying printers can prove profitable in the long run.

For accounting where the print volumes are really high and the quality of prints do not make much of a difference, dot matrix printers remain the best proposition. These have traditionally been the best choice for office purposes. However, now they are usually restricted to billing and accounting jobs. Anish Kunhambu, IT head, BMG Group India Pvt Ltd, adds, “It depends upon need. If you see, dot matrix and inkjet printers are still being used on a case to case basis, for example in banks, specifically in backward/rural areas.”

Servers

With the introduction of multi core CPUs, x86 has turned out to be the hottest option available for servers. Not just small but some large enterprises have also invested into x86 based servers. These servers are cheaper than UNIX RISC servers. In terms of robustness and reliability, the UNIX machines still win the game. The x86 server market is driven mainly by strong demand in the manufacturing/engineering sector along with the IT/ITeS sector. These have been the biggest spenders on servers in 2006 and yet their thirst has not been slaked.

The need for data centres is gaining ground in the IT/ITeS and the manufacturing sectors and is further boosting server sales. The large volumes of data that these companies need to maintain their setups cannot be fulfilled by primitive methods. Thus a need for servers dedicated to a data centre is on the rise, though small enterprises still have a long way to go.

Though it has been seen that people prefer Linux servers in medium and large organisations, small enterprises are quite comfortable with Windows x86 servers which are relatively easy to manage. In fact in a rare scenario, it was seen at NA Shah Associate that a problem with the file services on a Linux server, made them migrate to Windows Server 2003 and they are more comfortable with it.

Internet Connectivity

A large number of organisations have gone in for leased lines. The only hiccup here is that the number is still far from absolute. Only 87 percent of these organisations have Internet connectivity. The good news is that most of the remaining companies are planning to get an Internet connection this year, and by next year we may see this figure rise to 95 percent.

The surprising thing is that the most customer-centric sector, retail and services have only 81 percent of the organisations being connected, below the average. Internet bandwidth is also becoming cheaper and attractive pricing is driving companies towards connectivity. Some Internet service providers also offer firewalls and other security solutions so that companies can be relieved on the security front and focus on their core functional areas.

LAN

Fast Ethernet LANs dominate but with Gigabit Ethernet prices dropping, companies should rethink before implementing new LAN setups. A number of small enterprises are yet not connected through LAN as they fear complex networks and try to avert increasing maintenance costs. However, since enterprise applications won’t make sense without a LAN and a server, organisations are being forced to consider them.

Organisations in the small business segment need to be educated as to the benefits of sharing and collaboration. Organisations with less than 20 workstations might not require a Gigabit LAN, but at least a Fast Ethernet LAN is a must to run enterprise applications. Any company looking at high growth and a potential to join the big league, can’t escape networking.