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The Roundup: Vendor Overpayment Widespread

Gartner: Tips to Trim IT Costs Are you overpaying for networking equipment? Gartner Inc. reports that many Fortune 500 companies are overpaying an average of $500,000 per year by failing to take active steps to cut their costs. The key, Gartner says, is using negotiating best practices for vendor selection. Namely, that means getting vendors […]

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David Aponovich

Jun 12, 2001

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Gartner: Tips to Trim IT Costs

Are you overpaying for networking equipment? Gartner Inc. reports that many Fortune 500 companies are overpaying an average of $500,000 per year by failing to take active steps to cut their costs.

The key, Gartner says, is using negotiating best practices for vendor selection. Namely, that means getting vendors to compete against each other for your business, opening the door to potential discounts. That practice is expected to save corporations that shop around 20-50% on network costs through 2005.

Gartner found that a majority (exact numbers were not cited) of companies are staying with their current vendors (with whom, it was unsaid, they’ve likely had good track records and a working relationship). Also unsaid was this: It’s up to the customer to put a price on this and decide whether it’s worth shopping around.

Mark Fabbi, vice president and research director for Gartner, says, “The number of companies that have made the easy decision of just awarding business to their current vendor instead of actively negotiating has soared since 1998, which essentially takes a large amount of money from their bottom lines.”

Gartner’s tips for negotiation and vendor selection include:

Have a strategic plan for the network’s technical, operational and business requirements and select a vendor solution that meets that vision and no more.
Never award business for new capabilities to current vendors without making them earn a larger role as a provider.
Introduce competition between vendors. That will result in a more attentive vendor and larger discount as the vendors compete. Even when an enterprise is pleased with its current vendor, inserting a little doubt into the evaluation and negotiating process will pay big financial dividends.
Take advantage of the fierce competition in a vendor’s reseller channel. Rather than buying directly from the vendor, better deals are often obtained by buying through a channel such as a value-added reseller or system integrator.
Always negotiate on maintenance.

Something Else to Outsource: Security Intelligence

Add another category to the growing list of outsourced service providers. This one’s called security intelligence service providers.

Over the next several years, firms operating in this new category are expected to rake in hundreds of millions of dollars addressing network security issues, one of the most pressing needs – and worries – of IT executives, according to a report by The Yankee Group.

The tech research firm says that “security intelligence services,” which offer a range of services to protect corporate networks from invaders, are ready to explode as corporations try to get out in front of potential problems and implement solutions quickly.

With their sole focus, security service providers are seen as handling network security management as “a proactive process,” rather than the typically slow-moving, reactive mode (identifying policies, procedures, and vulnerabilities; then designing and implementing systems over weeks or months) under which many businesses now operate.

Yankee says the security intelligence services market, worth around $3 million in 2000, is projected to rise to more than $300 million by 2005. Such services “aggregate security threat information, create recommendations to plug security holes, and allow a user to customize the information that they receive and have it delivered in an actionable format. This intelligence in the security world is similar to what is provided by Reuters or Bloomberg in the financial services industries,” a Yankee analyst says.

Wireless Data: Subscribers Rising Fast

Dataquest, a unit of Gartner Inc., is forecasting an explosion of North American wireless data subscribers. Between 2000 and 2005, Dataquest expects subscriber totals to grow from 7.3 million to 137.5 million, including individuals who, for instance, want to get e-mail on the road and corporate warriors who need always-available wireless access to internal data, sales information or messages.

The rise in subscribers will be accompanied by a rise in “mobility-focused applications and consumer-based data services.” The trend will be driven by “the rollout of packet data networks on a nationwide basis, increased overall usage of wireless devices to receive messages and e-mail, inexpensive wireless data devices, and company specific applications, which improve the productivity of the mobile worker,” Dataquest reports.

This is the mobile workforce at work, buoyed by improved technology and competitive pressures that will drive the adoption of wireless data for corporate applications.

Wireless phone handsets will be the predominant access device, but PDAs are seen as quickly gaining popularity as a means of accessing information on the road. Also, application-specific devices (such as wireless gaming devices and QWERTY keyboard handsets) will be rolled out in the 2002-2003 period.

Women Turning to Net to Communicate

A newly released study finds that a majority of businesswomen think their ideas are more likely to be heard, appreciated and responded to when they use online communication at work, rather than face-to-face discussions.

That’s the result from a survey of 675 mid-level and senior U.S. businesswomen, developed by the Simmons Graduate School of Management (GSM) Center for Gender in Organizations in Boston and administered by Compaq Computer in May. It looked at the impact of Net-based communications – namely email and online collaboration tools (i.e. Lotus Notes) on their careers.

The survey found that about two-thirds of the women believe that using online communication (compared to face-to-face discussions) meant their ideas are more likely to be heard (65%), that their colleagues are more responsive (66%), and that it is easier to express their thoughts (67%). Sixty percent said online communication made it easier to get a meaningful place in workplace discussions and decision-making, and 52% said their work was more likely to be appreciated. Fifty-seven percent felt their gender matters less when they use e-mail or online collaboration tools, compared to communicating face-to-face.

Poll: 25% Attack Their Computers

If you’ve ever kicked, punched or smacked your computer, you’ll be glad to know you’re not alone.

Anecdotal evidence compiled by Novatech, a U.K.-based computer products re-seller, finds in an informal poll of 4,200 customers that 25% of them had physically attacked their computer at one time or another.