A Mandate to Be Cheap
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@scottalanmiller said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
So cheap in this discussion doesn't mean changing the stated goals to find a less costly solution, it just means finding a less expensive (cheaper) solution that still fills all the goals - I'm still lost how the new found solution wouldn't be the best? I suppose it could be that the 'cheaper' solution could require 10 hours of manual work by IT, where the more expensive option would require none or 1 hr, as an example.
What is best is "what improves the company's bottom line the most."
If the cheaper solution does not improve it the most, it's not the best. Period. Meeting base requirements or costing less to acquire aren't what do those things. They might, easily, but there is no direct connection.
Time out here - if the ongoing support makes the product more expensive, then clearly it's not the cheapest solution, and IT is failing to make management (IT management) understand this. Thought, this still breaks into the TCO, not ROI, so I'm not sure where ROI becomes more important?
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@dafyre said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
Edit: The final decision was made by administration and not IT, as it were. We did what you would have done, @scottalanmiller : We let them make the decision.
Technically, whoever makes the decisions is IT. So they just turned into IT management.
It seems like I'm always hearing you tell us to do whatever management says? How does that factor in here?
Because the reality is because they have made themselves IT management, not you. It's like a company that has a bunch of accountants, all of them do their part, giving reports on accounting about the company to the CFO, but the CFO is the HNIC and makes the decisions
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@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
Edit: The final decision was made by administration and not IT, as it were. We did what you would have done, @scottalanmiller : We let them make the decision.
Technically, whoever makes the decisions is IT. So they just turned into IT management.
It seems like I'm always hearing you tell us to do whatever management says? How does that factor in here?
Because the reality is because they have made themselves IT management, not you. It's like a company that has a bunch of accountants, all of them do their part, giving reports on accounting about the company to the CFO, but the CFO is the HNIC and makes the decisions
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
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@Dashrender said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
So cheap in this discussion doesn't mean changing the stated goals to find a less costly solution, it just means finding a less expensive (cheaper) solution that still fills all the goals - I'm still lost how the new found solution wouldn't be the best? I suppose it could be that the 'cheaper' solution could require 10 hours of manual work by IT, where the more expensive option would require none or 1 hr, as an example.
What is best is "what improves the company's bottom line the most."
If the cheaper solution does not improve it the most, it's not the best. Period. Meeting base requirements or costing less to acquire aren't what do those things. They might, easily, but there is no direct connection.
Time out here - if the ongoing support makes the product more expensive, then clearly it's not the cheapest solution, and IT is failing to make management (IT management) understand this. Thought, this still breaks into the TCO, not ROI, so I'm not sure where ROI becomes more important?
ROI is the most important on static style purchases.
For example if you have to purchase a new 300Ton punch press, which cost $3million to purchase.
Do you want to purchase it with a loan from a bank, or business capitol. When will the machine have paid for its self.
Support never factors into the ROI equation, unless the RTO is meant for a mission critical business function (IE support fixes an issues that saves the business a lot of money, that otherwise would have been lost without that support)
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@dafyre said in A Mandate to Be Cheap:
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
Why is it a problem at all? As long as everyone knows who is the IT decision maker, that's all that matters. That's the person you (I dislike saying this) blame when things don't work because of some decision that was made.
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@scottalanmiller said in A Mandate to Be Cheap:
@coliver said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@DustinB3403 said in A Mandate to Be Cheap:
The term cheap to me (and I think others) means it needs to perform to the level that we can still run production (or whatever the use case is) and save more money than what we may have been proposed before.
That's an undefinable definition. Cheap but not the cheapest, good but not the best for us. So not the best option for the business, but not recklessly cheap. How do you make decisions around that? How do you decide what is "cheap enough" while being "not so bad" but not just choosing "what is best for the financial interest of the business?"
I'm seriously, without a clear definition but also without the goal of doing what is right for the business... what's the motivator for this? What makes something the lesser choice, but good enough?
Isn't part of being the best solution also having the lowest cost while still getting all of the needed items from that solution?
Right, but cheap denotes that you are making sacrifices that would stop you from getting the best solution for you business. At least to me it does.
Exactly. "Best" is no longer the decision factor... something else is. Anything else, is bad. Cheap is just one of many bad options.
I think it's important to make the distinction that "best" is not a factor. It is a matrix, unlike "cheap", which is tied to a single factor.
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@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
Why is it a problem at all? As long as everyone knows who is the IT decision maker, that's all that matters. That's the person you (I dislike saying this) blame when things don't work because of some decision that was made.
Because of the political culture there, they were often trying to blame IT for bad decisions that were made over our head.
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@dafyre said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
Why is it a problem at all? As long as everyone knows who is the IT decision maker, that's all that matters. That's the person you (I dislike saying this) blame when things don't work because of some decision that was made.
Because of the political culture there, they were often trying to blame IT for bad decisions that were made over our head.
...because that never happens
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@art_of_shred said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
Why is it a problem at all? As long as everyone knows who is the IT decision maker, that's all that matters. That's the person you (I dislike saying this) blame when things don't work because of some decision that was made.
Because of the political culture there, they were often trying to blame IT for bad decisions that were made over our head.
...because that never happens
I have never seen this occur, ever. ;-(
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@dafyre said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
@coliver said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@DustinB3403 said in A Mandate to Be Cheap:
The term cheap to me (and I think others) means it needs to perform to the level that we can still run production (or whatever the use case is) and save more money than what we may have been proposed before.
That's an undefinable definition. Cheap but not the cheapest, good but not the best for us. So not the best option for the business, but not recklessly cheap. How do you make decisions around that? How do you decide what is "cheap enough" while being "not so bad" but not just choosing "what is best for the financial interest of the business?"
I'm seriously, without a clear definition but also without the goal of doing what is right for the business... what's the motivator for this? What makes something the lesser choice, but good enough?
Isn't part of being the best solution also having the lowest cost while still getting all of the needed items from that solution?
Right, but cheap denotes that you are making sacrifices that would stop you from getting the best solution for you business. At least to me it does.
But in this case, the "best solution" just happens to have all the features they want and need at the lowest price point.
The cheapest solution isn't always going to be the best solution for a business... but sometimes it is.
Please give an example of a solution that isn't the best while meeting the goals and is cheaper than the best solution.
PowerCAMPUS vs Jenzabar's POISE product lines... (this was a real choice at my last job)... We went with PowerCampus, because it did most of the things we wanted it to do, but it still lacked several features of the more expensive POISE product that would have made many things much better across our campus.
PowerCAMPUS did most of what we wanted, it met most of the goals, and came out cheaper than POISE.
Edit: I was agreeing with you, @Dashrender , lol.
So they actually prioritized cost OVER meeting the needs? Or were the goals not really needs and therefore the process exposed bad goal making?
Yes, pretty much to all of that. My last employer did not have an infinitely deep purse from which to pull money out of their... hat. So we had to stay with in limits. The implementation of PC was cheaper by more than 50%, while retaining the largest portion of features that were actually needed.
Of course they didn't have a deep purse, they were not focused on maximum profits but on being cheap - so they had problems because making money was not driving their thinking and they were demonstrating the problems that I am highlighting in this thread.
If they had the "best" solution and could not afford it, a bank would certainly loan them the money to do it because it would be so obviously the way to make money.
No. The bank did not loan them the money, lol. They asked about that.
If they are consistently not making the best decisions, I would not loan them money either
Did they present a solid profit case or just... ask for money? -
So the summary to this topic is to find the lowest cost solution that meets the business needs, which effectively boosts the business profits.
So the term cheap (generally) means, Find a solution that meets our needs, and boost profits as much as possible.
Anything else that needs to be added?
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@dafyre said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
Edit: The final decision was made by administration and not IT, as it were. We did what you would have done, @scottalanmiller : We let them make the decision.
Technically, whoever makes the decisions is IT. So they just turned into IT management.
It seems like I'm always hearing you tell us to do whatever management says? How does that factor in here?
What do you mean? The person making the decision is IT Management. And it is their job to do what the management above them tells them to do. IT Management starts when IT decisions are made, non-IT management would be telling them what the goals are like cheap, profit, etc.
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@DustinB3403 said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
So cheap in this discussion doesn't mean changing the stated goals to find a less costly solution, it just means finding a less expensive (cheaper) solution that still fills all the goals - I'm still lost how the new found solution wouldn't be the best? I suppose it could be that the 'cheaper' solution could require 10 hours of manual work by IT, where the more expensive option would require none or 1 hr, as an example.
What is best is "what improves the company's bottom line the most."
If the cheaper solution does not improve it the most, it's not the best. Period. Meeting base requirements or costing less to acquire aren't what do those things. They might, easily, but there is no direct connection.
Time out here - if the ongoing support makes the product more expensive, then clearly it's not the cheapest solution, and IT is failing to make management (IT management) understand this. Thought, this still breaks into the TCO, not ROI, so I'm not sure where ROI becomes more important?
ROI is the most important on static style purchases.
For example if you have to purchase a new 300Ton punch press, which cost $3million to purchase.
Do you want to purchase it with a loan from a bank, or business capitol. When will the machine have paid for its self.
Support never factors into the ROI equation, unless the RTO is meant for a mission critical business function (IE support fixes an issues that saves the business a lot of money, that otherwise would have been lost without that support)
Support, uptime, maintenance... are always part of ROI.
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@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
Why is it a problem at all? As long as everyone knows who is the IT decision maker, that's all that matters. That's the person you (I dislike saying this) blame when things don't work because of some decision that was made.
I agree, I see no problem at all. Not even sure what the perceived one is. Maybe that the IT Managers were not admitting that htey were?
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@scottalanmiller said in A Mandate to Be Cheap:
@DustinB3403 said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
So cheap in this discussion doesn't mean changing the stated goals to find a less costly solution, it just means finding a less expensive (cheaper) solution that still fills all the goals - I'm still lost how the new found solution wouldn't be the best? I suppose it could be that the 'cheaper' solution could require 10 hours of manual work by IT, where the more expensive option would require none or 1 hr, as an example.
What is best is "what improves the company's bottom line the most."
If the cheaper solution does not improve it the most, it's not the best. Period. Meeting base requirements or costing less to acquire aren't what do those things. They might, easily, but there is no direct connection.
Time out here - if the ongoing support makes the product more expensive, then clearly it's not the cheapest solution, and IT is failing to make management (IT management) understand this. Thought, this still breaks into the TCO, not ROI, so I'm not sure where ROI becomes more important?
ROI is the most important on static style purchases.
For example if you have to purchase a new 300Ton punch press, which cost $3million to purchase.
Do you want to purchase it with a loan from a bank, or business capitol. When will the machine have paid for its self.
Support never factors into the ROI equation, unless the RTO is meant for a mission critical business function (IE support fixes an issues that saves the business a lot of money, that otherwise would have been lost without that support)
Support, uptime, maintenance... are always part of ROI.
Of course, but support is a constant (in most cases) it's like paying for your cell phone bill. It's a cost of having a cell phone.
But the idea that support effects ROI would mean the Punch Press in my example, will never complete it's ROI.
Which means as a business just close shop and don't purchase the Punch Press.
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@DustinB3403 said in A Mandate to Be Cheap:
So the summary to this topic is to find the lowest cost solution that meets the business needs, which effectively boosts the business profits.
No, that should not at all be the take away.
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@scottalanmiller said in A Mandate to Be Cheap:
@DustinB3403 said in A Mandate to Be Cheap:
So the summary to this topic is to find the lowest cost solution that meets the business needs, which effectively boosts the business profits.
No, that should not at all be the take away.
And why not, the point of being in business is to turn a profit.....
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@art_of_shred said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@coliver said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@scottalanmiller said in A Mandate to Be Cheap:
@DustinB3403 said in A Mandate to Be Cheap:
The term cheap to me (and I think others) means it needs to perform to the level that we can still run production (or whatever the use case is) and save more money than what we may have been proposed before.
That's an undefinable definition. Cheap but not the cheapest, good but not the best for us. So not the best option for the business, but not recklessly cheap. How do you make decisions around that? How do you decide what is "cheap enough" while being "not so bad" but not just choosing "what is best for the financial interest of the business?"
I'm seriously, without a clear definition but also without the goal of doing what is right for the business... what's the motivator for this? What makes something the lesser choice, but good enough?
Isn't part of being the best solution also having the lowest cost while still getting all of the needed items from that solution?
Right, but cheap denotes that you are making sacrifices that would stop you from getting the best solution for you business. At least to me it does.
Exactly. "Best" is no longer the decision factor... something else is. Anything else, is bad. Cheap is just one of many bad options.
I think it's important to make the distinction that "best" is not a factor. It is a matrix, unlike "cheap", which is tied to a single factor.
Best remains a factor... that factor being "the most value to the business goal of profits".
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@dafyre said in A Mandate to Be Cheap:
@Dashrender said in A Mandate to Be Cheap:
@dafyre said in A Mandate to Be Cheap:
This was prevalent for a number of years at my job... As I was leaving, it did not seem to be quite as large of a problem.
Why is it a problem at all? As long as everyone knows who is the IT decision maker, that's all that matters. That's the person you (I dislike saying this) blame when things don't work because of some decision that was made.
Because of the political culture there, they were often trying to blame IT for bad decisions that were made over our head.
That's not the problem. The problem is trying to blame "in the trenches" IT and not the IT managers. Did the IT staff explain that IT management HAD made bad decisions, but that the people running IT were not labeling themselves as IT? If not, of course they blamed the remaining people who didn't explain who they were reporting to.
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@DustinB3403 said in A Mandate to Be Cheap:
So the term cheap (generally) means, Find a solution that meets our needs, and boost profits as much as possible.
Cheap never means that, as I explained. Never.
