2021 Tech Budgets

The year 2021 might be a harrowing year for business as they struggle to recover from the effects of Covid 19. Many organizations will have to go back to the drawing board to plan for 2021 based on the reduced revenue in 2020.

Organizations will be required to enhance their operations by adopting the use of technology remotely. This means more hardware will be necessary to achieve such objectives.

How will Organizations Allocate 2021 Hardware Budget?

The year 2020 has radically changed how organizations perceive work and office space. Going forward into 2021, allocating funds for the acquisition of hardware will require knowledge of the specific hardware and how that particular hardware will enable smooth workflows.

Business and Tech leaders have their say;

Jorge Rojas, a partner at Tektonic Inc, states that revising the age of hardware to determine their current utility value will be critical. This will depend on how long the hardware has served the client.

Rojas states the timeframe will depend on clients and the time of budgets and could be as little as 3 years or 6-7 years.

Rojas alludes, “we revise the age of the computers /servers to see if they have passed their useful life. The time frame depends on clients, and the time of budgets they have could be as little as 3 years or 6-7 years depending on the client and type of business.”

Jack Smith, CEO of Initial.IT, opines that in coming up with an IT budget for 2021, businesses will have to adopt what he calls utility computing i.e., paying for only what the business consumes.

He further notes that the “driving force behind an appropriate IT budget should always be company business objectives as delivered through a set of principles and standards across the key areas of IT, including applications, infrastructure, and security.”

According to Smith, SaaS and other cloud reference architectures are fabulous in “helping companies avoid using precious capital to invest in legacy IT hardware.”

Donna Hall of OnPar Technologies predicts a radically different 2021 IT budget. As the pandemic continues unabated, Hall foresees a continuation of work from home routine.

She observes that her company is already seeing “an influx of companies who want to improve their work from home capabilities with a large number of clients requesting laptops, docking stations, additional monitors, headsets, and web cameras.”

What Are the Top/Best Hardware to Include in Your 2021 IT budget?

For Jorge Rojas, UPS and backup units should be in good working condition going into 2021. To survive in the new normal, Rojas states that, with employees likely to continue working remotely, notebooks, monitors, webcams, headsets and VOIP systems will be key.

Despite an influx of clients requests for laptops and work from home infrastructure, Donna Hall predicts a switch from hardware to more software as organizations move in to secure their remote workforce.

Nick Allo from SemTech IT Solutions predicts that the 2021 hardware budget will include headsets with microphones, laptops, webcams, and desk phones. All this to enhance remote working.

Jack Smith, quoted earlier talking up the utility computing approach, observes that investing prominently in hardware will be a waste of precious capital. Smith suggests an investment in Saas and cloud reference architecture.

For Ilan Sredni, the COVID pandemic will necessitate investment in better remote strategies and hardware as well as proper monitoring and protection for all workstations remotely accessed by employees.

How Do Organizations Calculate the Cost of IT in their Budgets?

On helping clients come up with a budget, Jorge Rojas suggests a standardized approach, incremental saving for heavy investments and cyclical replacement.

He states that “ways to calculate a budget depends on the client and the type of equipment they have standardized on a lump price for computer/ installation i.e., 2000.00 / machine to be replaced.

For servers, it gets trickier, and since they cost more. It is best to have clients incrementally save for it, so it is not a 30k surprise at the end of their year.

Another way is to replace a percentage of computers per year i.e., 20%, so after 5 years they are all replaced, and then the cycle starts again.”

For Ilan Sredni CEO and president at Palindrome Consulting, the hardware budget boils down to a formula. He recommends that “businesses set aside 3-5% of the annual revenue for an IT budget.

He further states that hardware replenishment should be well planned stating that Palindrome Consulting helps clients create “ a 3-year roadmap” for hardware replacement. 2021 will, therefore, be a continuation of what his organization has been doing all along.

This long-term view of the IT budget is shared by Michael Nelson of TLC Tech, who states that a good budget should project “4 years into the future” based on IT support services, IT ancillary, and hardware purchases. On hardware, Nelson recommends a refresh rate of between 4 years for desktops, 5 years for servers, and 6 years for firewall and switches.

What is the Most Affordable Hardware for your IT Budget?

The most affordable hardware ought not to be cheapest rather that which will give you value your money.

Michael Nelson indicates that as for the “most affordable” hardware, they encourage partners to look at not just the “cheapest machine” but what will get the highest return on investment. He puts it as follows;

“Does it make sense to spend $200 extra on a machine with much more RAM and a solid-state drive? If you’re looking at a 4-year refresh, that’s an extra $50/year for a machine, which is $4/month. You only need to increase the productivity of your minimum wage employee by 15 minutes a month to see the return on investment. For a professional level employee, you’re looking at a much higher ROI.”

Nick Allo points out that among the hardware to be included in the 2021 budget are; headsets with microphones, laptops, a more powerful Firewall for remote traffic, webcam’s, and more desk phones to go remote.

How are Hardware Budgets Changing/Will Change With the “New Normal?

Some changes are expected to happen on hardware budgets as a result of the effects of Covid-19. Companies might continue encouraging their employees to work from home or remotely in the 2021 “new normal.” This will be in a bid to ensure minimal contacts among staff to avoid the spread of infections.

According to Jorge Rojas, “the new normal will include; notebooks, monitors, webcams, headsets, VOIP systems to allow employees to work remotely.”

On the new normal, Michael Nelson says that a lot of companies are looking at migrating to the cloud to reduce the cost of on-premise servers. This is also to allow staff to securely work from anywhere, anytime, and from any device. Nelson notes that there will be a need for appropriately configured desktop or laptop to keep up with the needs of remote employees.

For Ilahi Sredni, taking into account COVID changes, “businesses need to invest in better remote strategies and hardware, as well as proper monitoring and protection for all the remote workstations being used for remote access by the employees.”

Final Verdict

It is by now clear that 2021 hardware budgets will be a radical departure from past years. The new normal brought about by the COVID pandemic will force organizations to enhance their work from home capabilities. Investing in new or better hardware will be a key priority for 2021.

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