Five key benefits of Inventory-as-a-service
Agilitas CEO Shaun Lynn explains the potential of the emerging channel service
The growth of the cloud and the evolution of the mobile workplace have altered demand for IT spares. With less organisations managing their own on-premise data centre, where and when spares are needed has changed. At the same time, a higher reliance on IT has meant any period of downtime will cost significantly, with just one hour estimated to cost 54 percent of end users between £10,000 and £1m. This new status quo puts more pressure on resellers, service providers and OEMs to better provision for faults and provide customers with an effective service. Inventory-as-a-service from a trusted partner can go a long way to help achieve this. These are the key benefits:
1. Costs are OPEX not CAPEX
Maintaining an IT hardware spares inventory has always been a high cost area for businesses. According to research, nearly 30 percent of resellers and service providers are spending over £50,000 a year on spare inventory for customers, with the figure rising to more than £1m in 20 percent of cases.
The cost of inventory-as-a-service is usually benchmarked as an operational expense that doesn’t change – an approach in line with demand according to Cisco chief Chuck Robbins, who recently commented customers are “fundamentally more concerned about the operational costs of their IT infrastructure than the CAPEX.”
2. IT parts expenses can be reduced
Keeping costs down and driving efficiency are two of the most vital qualities of any business. Provisioning for any spare part that might be needed is always going to be expensive, especially as there is rarely any indication as to what will be required when. Parts are often going totally unused. Our research revealed a quarter of providers are spending hundreds of thousands of pounds just to keep up with customer requirements for spare inventories. At what point does this go from being a simple budgeted overhead to an unavoidable cost that threatens a company’s growth plans?
A good inventory-as-a-service partner will have their own multi-vendor/technology repair centre and test rigs. These ensure parts are reused, reducing waste, unnecessary expense, and driving down operational costs further.
3. Two hour SLA
Business is being conducted more quickly, and as a result customers are demanding instant inventory services. Whereas previously, four hour service level agreements (SLAs) were the norm, this has quickly been halved to two. High speed delivery is essential to maximising uptime. However, the potential fallout from any failure to meet SLAs can be significant, which is where inventory-as-a-service is pivotal.
For OEMs, service providers and resellers alike, ensuring the right support is in place can determine the success of a product or IT service. The logistics and management behind IT services are all invisible to the customer most of the time, but when required, performance needs to be meeting SLAs 99 percent of the time regardless of technology or vendor.
One of the lesser recognised benefits of inventory-as-a-service is training. Good partners enhance the ability to meet two hour SLAs by upskilling existing field engineers and on-site technical staff to resolve some faults themselves. The inventory partner will ensure an IT spare part is rapidly delivered to the customer site and a member of their technical staff will swap it for the faulty one, with the knowledge that additional technical resource is on-hand should it be required. This means that costs can be reduced as less callouts are required, whilst helping to keep downtime to a minimum and increasing operational efficiency.
5. Remote support
In addition to upskilling existing staff, inventory-as-a-service partners are able to deliver rapid fault resolution by carrying out fixes remotely. Skilled engineers can take a member of on-site staff through a simple process to ensure network fault resolutions can be made without a call-out. Equally, as we become more dependent on technology, downtime can be reduced as an experienced remote engineer can be working on getting something fixed within seconds of it going wrong.
Managing inventory is always going to be a challenge for a non-specialist business, as getting the correct ratio of spares to existing technology is expensive, and engineers in the right place and time don’t come cheap either. The growth of mobile and cloud technology has altered demand, however the key aim remains to be maximum uptime. Inventory-as-a-service ensures networks are repaired quicker than any alternative. The need to explore a high performance, efficient and cost-effective inventory–as-a-service-solution is now greater than ever, not only for end user companies but their IT service providers.
Shaun Lynn is CEO of Agilitas
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