March 24, 2019

The Yin and Yang of Open Source Commerce, Part 3 - page 2

Chewing Over the Numbers

  • November 3, 2005
  • By John Terpstra

The enterprise market is staffed with IT experts. Some enterprise market IT is outsourced, and sometimes all of it. The majority of large sites employ permanent IT staff who play a key role in specifying the solutions framework for IT investment. They exercise a controlling interest in the purchasing decision, albeit with considerable management intervention and oversight.

The buying process in enterprise companies can be complex. This means that the final purchase outcome is often somewhat haphazard when political and social factors exert a role as the purchase and deployment decision is made. For example, the CIO of a large financial market business took the advice of a friend who is member of his college alumni. He thus did something no one could have anticipated when he overruled his own staff and hired a full-time Linux support person to head up a new project. Sometimes, too, this works in the opposite direction.

One factor that weighs against adoption of a lower cost IT infrastructure in the enterprise market is the fact that some CIOs salaries are tied to the number of IT employees they manage and to the size of budget under their control.

New technologies are under constant review. It is not uncommon for more conservative sites to ask for cost estimates and then not to implement, or make a purchase decision for two years. Many ask for cost estimates so they can obtain budget allocations up to 18 months before activating the project.

Hardware purchases are generally planned well in advance and are subject to planned obsolescence (replacement) over a 3-4 year cycle.

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