Intel promoted an industry analysts’ report that calls the 3-4 year upgrade cycle of PCs a fallacy and pushes for a 2-year refresh cycle. The report “Replacing Enterprise PCs: The Fallacy of the 3-4 Year Replacement Cycle” (PDF) is compiled by J. Gold Associates, LLC and was reposted by Intel yesterday.
My initial reaction is to state the obvious in defense: Of course Intel wants to promote buying more computers (with Intel processors, of course) and buying them more frequently. While that might be best for their shareholders, is it best for your organization? It is going to be hard to argue against an industry analyst that has quantified user productivity and broken it down into average yearly savings, ROI, and percentage of employee costs. While I might not be able to win the argument, which I do not think is all wrong, I instead aim to poke a few holes in it with the hope that it will make people pause and think if they really need to up their PC refresh cycle.
From my professional experience and working with various clients, I know a significant portion of organizations are still establishing a PC refresh program. There is certainly merit to a refresh cycle and figuring out how long it needs to be will be up to the individual organization and how they order computers. If you buy a computer to start out with the latest generation Core i7 processors and a significant amount of RAM, that computer should continue to meet your needs longer than if you buy all of your computers with the previous generation Core i3 processors and only enough RAM to meet the minimum system requirements of your operating system.
The report states:
“Common industry practice says that enterprise PCs should be replaced on a 3-4 year cycle, when the costs of maintaining the PC outweigh the cost of replacing it. Indeed, this has been commonplace for many years, and companies still accept this as fact. However, is this model still valid in the modern age? Does it still make sense for companies to wait for an extended period of time in an era of rapid chip technology improvement, cloud-based systems and consumer-driven technology upgrade cycles? Our analysis indicates a significant ROI can be achieved by upgrading more often, despite the costs involved in migrating users to new systems….”
At the same time you hear of Moore’s law slowing down, the industry analyst wants to claim an era of rapid chip technology? Intel’s 4th generation processor was a moderate improvement but focused a lot of power management. For laptops and other battery-powered mobile devices, that can make a difference to productivity but for desktops it would not be that noticeable.
The increase of cloud-based systems actually hurts the argument of a faster refresh cycle, so I’m not sure why it’s included. If you are offloading more processing to servers, the desktop does not need to be as powerful or have as many resources. Virtual desktop clients are expected to have an 8-10 year life cycle because the heavy lifting is done on the server. As more applications become Software-As-A-Service and the desktop becomes a glorified web browser, how would a newer processor and more RAM make a difference? The report does distinguish that the productivity gained by a newer PC would vary by role, so the 3D designer might see more improvements than the data-entry clerk.
“Enterprises should establish a PC refresh program that is not based on ‘old thinking’ industry practices established many years ago,” says Jack Gold, president of J.Gold Associates, LLC. “We strongly recommend companies immediately move to a refresh cycle of two years for their corporate PCs. The increased levels of productivity available from newer devices offer both a substantial ROI of 500-1000 percent as well as provide for a more efficient workforce, allowing organizations to do more with the resources they currently have.” The report from Jack Gold notes that the cost of a new machine is considerably less today, on a device to employee expense ratio, than it was a decade ago when many of the recommendations were established. Organizations must look at the negative cost implications of keeping older devices past their prime.
While having older equipment might dampen your recruiting efforts or disappoint employees by not having the latest and greatest, the most important thing is that it will still allow them to complete their jobs efficiently. We are talking about having 3-4 year old computers instead of 2 year old computers. Most manufacturers provide a 3-year warranty as their default offering.
The take-aways from reading the report should be that a broad recommendation from an industry analyst should spur thinking before action. A 2 year refresh cycle could be considered for top users but should not dictate policy. An organization’s IT should evaluate the warranty coverage, budget/costs, productivity, hardware improvements, and technology needs to determine the refresh cycle they can support and where they will gain productivity improvements. Having a refresh cycle can insulate a business from unexpected expenses while taking advantage of technology improvements in a measured way. I would still recommend a 3-4 year refresh cycle for my clients and make exceptions to it, not the rule. This clearly seems like a means to push more sales while being of minimal benefit to the purchasing enterprise.