IT equipment – upgrade or buy new?

As your business IT equipment approaches the end of its useful life, there comes a point where you need to decide whether it’s worth performing a hardware upgrade, or whether purchasing replacement equipment is the better option. Craig Sharp from Business Wales considers the choices.

When to perform a hardware upgrade

When assessing the IT needs of my clients, I often ask how old their computers are. The reply, “Oh, not that old … about four to five years old,” always makes me take a sharp intake of breath.

Four to five years old is past the point of reliability for most pieces of IT hardware. In the business, we call this ‘life expired’. It’s done the job and given good service, but it’s time to let it go. Large businesses like banks and big corporates work on a three year lifecycle for hardware because they can’t afford it to fail.

There are several reasons three years is a good benchmark for IT replacement. Many manufacturers often offer three year warranties on equipment. If you take the warranty, you can replace the hardware when it expires, because moving parts like fans and hard disks become more unreliable after this point.

Upgrade computers and servers?

If you have a network server, it is the heart of your IT system. It holds your vital data and probably controls your email and any remote working functions. If you have had your server for three years or longer, upgrading or replacing it should probably be a priority.

But which of those options is best? Well, a server will often have expensive parts. For example, the fast, reliable memory chips that servers require can cost three to five times more than for a desktop PC.

Additionally, a server upgrade may involve installing new hard disks. If so, backing up your old hard disks, switching and then restoring all your important business data is almost as much work as putting a new server in place. So, on balance, I generally feel servers should be replaced, not upgraded.

For desktop computers, consider how they are used in your business and how important they are to your operations.

For instance, if the computer in question is used to process your business accounts, that’s pretty important. Investing in a new PC here will give you peace of mind and reliability. A rolling program to replace hardware in stages is a good way to spread the cost and reduce the chance of disruption from hardware failure. 

However, if the PC is only used once or twice a week for admin tasks, perhaps a memory upgrade (this will usually give you the biggest “bang for the buck” in terms of upgrades) to get another 12-18 months’ use would be a better use of resources.

Upgrade computers before they fail

Assessing the importance of your hardware will help you focus your resources on the areas that really matter.

It’s important to make an honest assessment of what equipment failure could cost you. For instance, a new desktop computer for general administrative use might cost £400. But if you wait for the existing computer to fail before replacing it, it could easily cost you more than that in lost productivity. An IT asset register can help you identify how old each piece of hardward is and which items should be replaced before it’s too late.

Upgrades may also look less attractive once you realise you can cut the cost of replacement hardware by reusing some of your existing kit. For instance, you can usually reuse old monitors with new computers, and – depending on the type of software licence – you can often transfer software across to a new computer rather than having to buy it again.

Our thanks to Business Wales.