November 2006 — Features
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Special Section: Resource Management :: Value Judgments
A CoSN report on “Why Total Cost of Ownership Matters” suggests that school districts conduct regular TCO analyses that accomplish the following:
- provide management oversight
- identify and document both direct and indirect costs
- measure and improve the effectiveness of technology initiatives
- develop and document budgetary guidelines
- develop the business case for new technology projects
- inform stakeholders of management practices and budgetary needs
Given that the TCO tool is free and available, given that all districts need to produce accurate budgets, and given that with planning, districts can save money and provide better services, one has to wonder why anyone wouldn’t use the tool, especially when districts are implementing such individualized programs.
THE VALUE OF VOI
A companion to TCO can provide more help to schools in evaluating the cost-effectiveness of technology initiatives.
The Consortium for School Networking (CoSN) has developed a companion to its total cost of ownership tool: value of investment (VOI). The project is formally named the Value of Investment Leadership Initiative, and its intent is to help schools better evaluate the costs and benefits of proposed technology programs. Among the initiative’s sponsors are Intel, Gateway, and SchoolNet. Whereas TCO looks at installed (and optionally planned) computer environment costs, VOI looks at expected costs and benefits of technology projects. CoSN’s VOI website outlines a five-step approach for determining value of investment:
- Estimate project costs.
- Assess risk.
- Calculate anticipated savings and revenue.
- Measure qualitative benefits.
- Evaluate results.
The site provides tools such as the Project Cost Estimator and the Project Benefits Worksheet.
The analysis the tool provides is essential, says Kaestner, if you’re trying to decide which kinds of technology—hardware, software, training, and support—to acquire. Why? Kaestner is reminded of the Cheshire Cat’s moderately helpful advice in Alice in Wonderland. Alice asks, “Would you tell me, please, which way I ought to go from here?” And the Cheshire Cat responds, “That depends a good deal on where you want to get to.” More to the point, says Kaestner, “If you don’t know what your technology’s costing you, how do you know what to do?” The TCO tool helps you figure that out.
