Tips for Working With Your Vendor to Cut Hardware and Software Maintenance Costs

By Kevin Davis

Director, IT Delivery, NPI

October 08, 2014

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Some of the maintenance renewals I review for clients blow my mind. Too often, large ($1M+) support renewals for hardware seem out of line with common sense in terms of value given for price paid, or don’t clearly identify which hardware is covered, or include hardware that is no longer used.

If this situation sounds familiar, you’re not alone. It happens way too often resulting in companies overspending on maintenance year after year.

Utilizing a third-party maintenance provider is an option for most common hardware manufacturers (Cisco, HP, IBM, Dell and EMC), and even for large-scale enterprise software (SAP and Oracle). But, going third party is not your only option for cutting maintenance cost.

Here are several options to help you cut maintenance costs on your largest IT deployments. Some may not be realistic for your environment, but they may be worth the effort in order to get the vendor to realize just how serious your company is about reining in superfluous spend:

  • Review what’s being supported and determine if some elements of support can be performed by internal resources rather than the vendor (for example, applying updates) – in some cases you will find that a lower level of support is adequate for your needs.
  • In cases of hardware/software combinations, explore whether you can use a third party to support the hardware, while keeping software support with the vendor.
  • Evaluate your current SLAs and determine if they still match your needs. For example, are you paying for 4-hour hardware part replacement when next-day service is good enough?
  • Be familiar with any upcoming new capital purchases with vendors to which you’re currently paying maintenance. Before renewing any maintenance agreements, leverage your purchase to negotiate a lower annual cost (and other terms such as caps on increases, tighter SLAs, etc.).

Maintenance renewals are one of the most important revenue streams for vendors. They will fight to keep this recurring revenue steady year after year, and will only budge after you make a convincing argument that their revenue is at risk.