IT Budgeting: Equipment

IT Budgeting: Equipment


coins.jpgToday's post is from PTG CEO Reed Wilson. 

Last month, I focused on how to plan for people and growth. This month I’d like to shift the focus on planning for your equipment needs in your annual budget (maintenance renewals, new, upgrades and replacements.)

When we do our internal budgeting process for equipment, we lump this into two broad categories. The first category is just for maintenance renewals. The second category includes new, upgrades, or outright replacements.

Maintenance Renewals

Maintenance renewals are very easy to maintain and budget. In most cases you can ask us and we will know exactly what is renewing for you next year, when it is renewing, and how much it will cost. In some cases, we may recommend against renewing if there is no benefit. An example is maintenance on an end-of-life software product where the vendor will continue to offer ‘support’ but no enhancements. We can help you review these on a case-by-case basis.

New Purchases

New purchases are also easy to budget with the right visibility. We know that every 3 years we will upgrade an employee’s laptop. This can be very expensive if you don’t plan for it or if you don’t space the purchases out over time. We don’t replace our entire laptop fleet at once, we do it on a three-year basis, based on the employee.

We also have a ‘standard’ for each employee role. For example, our sales team uses Surface Books and our services team uses Surface Pro 4 devices. Each workstation is set up identically which makes it easy from a support perspective and a common user experience.

You may also consider leasing new equipment to conserve cash. We have several customers that go this route and it works well for them.


Upgrades can be a bit tricky, so we rely heavily on anecdotal feedback from our team to determine what we may upgrade in the coming year. We categorize anything that will improve the experience as an upgrade.

For example, in 2014 our headcount doubled but our internet speed stayed the same. As a result, the performance of our cloud-based systems began to erode, so we doubled our speeds in 2015.

We also upgraded our wireless system in 2015 based on this growth.


Replacements could be considered upgrades – but in most cases they are done out of necessity versus an increase in performance. Network equipment most frequently falls into this category. Servers may also fall into this category – but we are encouraging customers to consider moving these workloads to the cloud where possible (to save money and increase reliability).

Generally speaking, you should expect to replace things like servers, switches, backup devices, and storage arrays every 5 years. Firewalls and security hardware generally are replaced every three years, simply because that is usually the vendor’s lifecycle for that equipment (although we recently partnered with Dell to offer firewall as a service – so you don’t have to worry about replacing the device).

Remember – if you are a PTG customer, we offer budgeting services as part of our offering to our customers (for free!), so if you need help in this process, just ask!

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