Moving the Conversation Beyond the ROI of Data Center ConsolidationValue Optimization
Return On Investment (ROI) is a hot topic for data centers looking to consolidate — and for good reason. Cost savings are the primary driver behind colocation and cloud-adoption strategies.
A common IT Asset Disposition (ITAD) sales pitch highlights ROI as part of the features and benefits of a vendor’s services. But ROI from data center consolidation is notoriously difficult to calculate. Leaping into consolidation based on promised ROI can come up short if you’re not careful to start with a good plan.
Here are some tips that cut through the ROI sales talk to help you focus on ITAD value recovery.
Three considerations to maximize your ITAD potential in data center consolidation
1) Redeployment potential
Are your data center assets even ready for disposition? Evaluating whether they have value in your organization is a good place to start. With some planning, used IT assets might have a use within your organization.
Many enterprise IT organizations are entirely giving up their hold on data management, and instead adopting hybrid strategies. In line with the principles of circular economy, repurposing the equipment you have is a solid first step in supporting your organization’s sustainability.
This is probably not a factor that most ITAD providers will sell you on. But it’s important not to be too eager to excess all of your equipment if you plan to keep some data storage in house.
2) Value recovery
How much are your assets worth on the resale market? This question seems daunting, but the first step to answering it is very simple: Track your assets.
Having a good hardware management plan in place can help you make an initial assessment of how much value your assets hold. Some of your gear may still be under warranty. But unless you are tracking how long you’ve had it, you might miss out on calling in that warranty.
Tracking your gear also supports bundling your assets. If you can easily locate numerous assets, you can bundle them together for resale and realize a higher return than your individual assets would have yielded.
3) Timing of disposition
It’s rare for IT assets to hold value, and they certainly don’t appreciate. So timing for disposal is critical.
Sitting on your assets won’t give you any edge on the market. Whether or not you have the storage space to keep used IT gear around, this is not a good strategy from a data security or IT Asset Disposition perspective. You’ll be paying to secure used assets while the resale value of the gear continues to go down — not a winning combination.
Think beyond data center consolidation
Enterprise ITAD directors face many challenges in determining what factors to consider when optimizing data centers. ITAD sales pitches promising big ROI with data center consolidation may sound appealing. But remember that consolidation only represents one point in the life of your data center.
Unless you have an ongoing plan for your IT assets’ retirement, an estimate for ITAD ROI is only going to get you so far. You need to look beyond consolidation. After all, data centers will need regular equipment refreshes. Creating an ITAD strategy that emphasizes sustainability offers a good starting point.
Bottom line: Every ITAD vendor promises ROI from data center consolidation. Pick one that offers a long-term value recovery strategy that looks beyond consolidation.