Taking Total Cost of Ownership to the Classroom

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Taking Total Cost of Ownership to the Classroom
Understanding Where You Are to Help Plan Where
You Are Going TCEA Conference February 4, 2004
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Todays Presenters

• Overview Jim Hirsch, Plano ISD
• About TCO and the TOOL Bill Rust, Gartner
• Current case study Ed Zaiontz, Round Rock ISD
• Putting TCO into Action Panel Discussion

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Background on CoSN

• Incorporated in 1992
• Mission CoSNs mission is to advance the K-12
  education communitys capacity to effectively use
  technology to improve learning through advocacy,
  policy and leadership development

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Members

• Primarily K-12 Educational Institutions (school
  districts, states, intermediate service units,
  and other nonprofits), plus companies and
  individuals that support our mission.
• Our core member is the key technology
  decision-makers at a school district level
  generically called Chief Technology Officers.

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The Challenge

• Schools often do not
• Plan for long-term costs of using technology
  effectively and efficiently
• Evaluate the role of technology in attaining
  their educational goals
• Budget adequately
• That means schools often do not anticipate and
  plan for Total Cost of Ownership (TCO)

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Concept of TCO Is Nothing New

• If you buy a bus, you must also budget for
• Gasoline
• Maintenance
• Repairs
• Increased Insurance Premiums
• Another Driver

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Similarly. . .

• If you build a network or purchase computers, you
  must also budget for
• Software
• Maintenance Repairs
• Increased Utility Costs
• Support
• Staff Development
• Replacement Costs

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Why CoSN Started Talking About TCO

• School leaders didnt understand how to plan for
  the long-term costs of managing technology
• Increasing complexity of networks makes
  understanding ongoing TCO more important
• Schools need to manage networks to avoid backlash
  against educational technology

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Taking TCO to the Classroom

• Initially Launched in June 1999
• New
• A Web-based TCO assessment tool developed by
  CoSN, Gartner and NCRTEC at NCREL
• Sponsored by U.S. Department of Education
• All available at www.classroomtco.org

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What Is TCO?

• All of the costs associated with deploying,
  operating and maintaining a computer network
• Analysis tool used by businesses since the
  late-1980s
• A method of understanding real costs to make good
  decisions on technology investments

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Why School Districts Should Monitor TCO

• Evaluate technology initiatives
• Provide management oversight
• Document direct and indirect costs
• Measure and improve technology initiatives
• Plan effectively for technology implementation
• Articulate the business case for technology
  investments
• Reassure policy makers that dollars are being
  used wisely

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TCO Should Not Be Evaluated in a Vacuum

• Success should ultimately be measured by
  whether those educational goals have been met
• Schools need to understand their educational
  goals and how technology will support their goals
  something a TCO analysis helps with
• The business of schools is education

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TCO Can Help Schools Meet Educational Goals

• By tracking tech support
• To minimize time computer and network is down
• To minimize troubleshooting interruptions for
  teachers
• By tracking the adequacy of professional
  development
• To ensure teachers are prepared
• To ensure teachers are integration tech into
  curriculum
• By tracking the pros and cons of various
  implementation and support strategies

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The New CoSN-Gartner TCO Assessment Tool

• Simplified version of Gartner business model
  adapted for K-12
• Defines data required for valid TCO assessment
• Provides calculations and some analysis
• Allows school leaders to input information

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Important Points to Remember

• Tool is most useful for measuring districts
  costs over time
• There is no right number
• Take care to provide good data
• Take care to understand the numbers and use
  correctly
• Comparisons, if made, should be with similar
  districts, but not recommended

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CoSNs Traditional TCO Indicators

• Technology Support
• Staff Development
• Software
• Retrofitting
• Connectivity
• Replacement Costs

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CoSN-Gartner TCO Tool Direct Costs

• Hardware
• Client Computers
• Peripherals
• Servers
• Network Equipment
• Printers

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CoSN-Gartner TCO Tool Direct Costs

• Software
• Infrastructure software
• Education administration
• Personal productivity
• Content and curriculum
• Direct Labor
• External Service Provider (ESP) Costs

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CoSN-Gartner TCO Tool Indirect Costs

• Hardest numbers to determine
• User survey is most accurate way to determine,
  such as
• How much time do you spend solving your own tech
  support problems?
• How much informal help do you get from peers?
• of time network is down
• of time computer not available

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CoSN-Gartner TCO Tool Output

• Total Costs a summary of direct and indirect
  district and per client costs
• Asset Metrics a breakdown of pervasiveness of
  client computers
• Asset Cost Metrics amortized costs of computer
  and network hardware
• Direct Labor Cost metrics an overview of
  district wide and per client direct labor costs
• Direct Labor Staffing metrics illustrates the
  number of client computers supported per support
  staff and average support staff costs

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(No Transcript)
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Applications Development Voice
In Scope
Out of Scope
Wide Area Network
Mainframe
Building Costs
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4 Case Study School Districts

• Vary in size and location
• Cover many technologies and strategies,
  including
• Different operating systems
• Different approaches to and levels of
  standardization
• Outsourcing and leasing
• Desktops, mobile devices, handheld devices

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Case Study Districts

• California urban district
• 140,000 students
• Utah suburban district
• 49,100 students
• Minnesota small town district
• 4,100 students
• Pennsylvania rural district
• 2,433 students

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TCO Challenges Faced by Some Case Study
Districts

• Inadequate staff development
• Insufficient and informal tech support
• Little asset inventory or management
• Non-centralized decision-making and management
  process

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Where Did Case Studies End Up?

• Two districts calculated TCO of 1,004/ client
  device
• Coincidence not significant
• Third district reported 1,491/ client but data
  collection proved challenging
• One needed to do further work on determining
  indirect costs
• Tool permits benchmarking, more limited reviews,
  and what if scenarios

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Important Points to Remember About a TCO Analysis

• Initial analysis data likely to be incomplete or
  based on rough estimates
• Helps focus attention on what you DONT know
• Should lead to more formal record-keeping
• Over time, data collection should become easier
  and more accurate
• There is value of ongoing assessment
• Becomes more accurate over time
• A means of measuring the impact of technology
  initiatives

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How Do I Get Started and use the tool?

• Go to www.classroomtco.org and click on CoSN
  Gartner TCO Tool
• Register for User ID by clicking on Request
  Access on the tool login page
• While waiting for a username/password, review
  Learn why TCO Matters and case studies
• Download definitions of data that should be
  collected (Step 1)
• Input data once it is gathered (suggest user
  survey to collect indirect cost data) Input is
  saved by the tool
• When accurately completed, provides a district
  benchmark
• Updated reports or what-if scenarios can also
  be created and stored

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Dissemination of These Materials Is Sponsored by

• ATT
• Blackboard
• Dell Computer
• eChalk
• Inspiration Software
• Palm
• Plato Learning
• Center for Digital Education

• Apple
• Microsoft
• Sprint
• Hewlett-Packard
• IBM
• Intel
• Texas Instruments
• 3Com
• AOL_at_School

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More Resources on TCO

• www.classroomtco.org
• CoSN-Gartner Tool, Data definitions and case
  studies
• White papers and presentations
• Additional tools and resources
• CoSN Gartner Tool Support (email)
• k12tco_at_alyrica.net

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Other CoSN Leadership Initiatives

• Safeguarding the Wired Schoolhouse
• www.safewiredschools.cosn.org Resources to help
  school administrators understand Internet safety
  strategies
• 3D Vision to Know Do
• www.3d2know.cosn.org
• Enabling educators to think strategically about
  the use of data driven decision-making
• Cyber Security
• http//securedistrict.cosn.org/
• Ensure the privacy and security of data

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Professional Development

• Annual K-12 School Networking
• Conference
• March 2-4 in Crystal City, VA
• (near Washington, DC)

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www.cosn.orgToll Free866-276-8747Consortium
for School Networking1710 Rhode Island Ave., NW
900Washington, DC 20036