As I pulled into the car dealership to look at a new car, smoke started to rise out of the engine. I hopped out of my car and said to the approaching car sales representative “I’d like to trade-in my car.” He responded, “Do I smell something burning?”
I was stuck. Either I buy a new car or I call a tow truck and a taxi, so I decided to purchase another car and leave my smoking old one with the dealership. It took some convincing, but they credited me $200 for my car and told me I should be paying them to remove it from their dealership.
The other day, I noticed the boxes of old technology I have in storage since I am running out of storage space. I seem to be hoarding a lot of older IT devices and I don’t know why I feel so attached to these old things. It seems like the only time I am willing to part ways with my cars, or my IT assets, is when they stop working. I find it difficult to get rid of things that work perfectly well, even though these devices are out of date.
Many organizations have a similar problem with their IT assets because they do not have a method in which to dispose of them. Companies that are able to control inventory by using ITAM standards usually know how they will dispose of their assets prior to purchasing. Companies that do not have policies for asset disposal can quickly become buried alive in older out-of-date equipment that costs more to operate and support than to simply dispose of them.
When I purchased my car, I decided I would drive that car until it stopped working. Lucky for me, it stopped working the day I decided to look at another car. I accepted several risks with this strategy. For example, I could have broken down and been stranded on a freeway. I would have had unexpected costs such as towing and who knows how much time it would have cost me.
Keeping IT assets until they stop working is not an option for an IT department. Unlike a car, IT equipment becomes outdated very quickly as technology advances at such a rapid rate. Managing the lifecycle of IT assets includes building an exit strategy into your purchase strategy. It is important that organizations understand how long they will keep an asset and how they will refresh it. Without an exit strategy for assets, you could lose control of your inventory which can also become a security problem. Many older assets do not support current security requirements.
Some people purchase or lease a car and then replace it every three years. Although, in the beginning it may appear to be more expensive, one could argue that the overall savings, including time savings, makes it cheaper to replace the car when the warranty expires. There is a much lower risk of having unexpected costs because everything is covered by the warranty. People who keep their vehicles after the warranty expires take on additional risk. Unexpected costs of repairs can tear into a family budget, interfering with projects around the house, vacations, and increased stress as a result of the circumstances.
IT organizations have budgets, and when those budgets are disturbed by unexpected costs that come from audits or repairs, the organization may find that they have to delay existing projects and future projects. I mention audits because if older assets are not disposed, then you could be paying for software licenses on those assets as well. If you are not properly tracking software licenses, you could end up with an unexpected cost against your budget resulting from a software audit.
IT Asset Disposition (ITAD)
ITAD processes and services help organizations in the following areas:
IT assets that are no longer needed by an organization need to be disposed of in an environmentally sensitive manner. Many countries have the ability to impose stiff fines to organizations that don’t dispose of IT assets properly.
- Sensitive data needs to be protected. When disposing of IT assets, methods need to be defined to properly sanitize all hardware that contains sensitive data.
- If assets are donated to a charitable organization, tax credits might be available to the organization making the donation. If assets can be sold, then an organization can recover some of the money originally used to purchase the assets. Several companies offer ITAD as a service and might be able to help line up charities or buyers for assets that need to be replaced.
It is important that IT assets are documented properly when they are retired. In Part 2, I will discuss how an internal ITAD process can be created within an ITAM solution to initiate the asset disposal process.