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2/2002 
The great IT spending stampede has passed. Now it's time to scour the wreckage for bargains, wherever they may be found.
by Brian Caulfield 
Remember MacGyver? The hero of a silly 1980s television show, he had a special talent for making flare guns out of discarded ramen noodle cups, and ultralight aircraft from broomsticks and ceiling fans. That's only Hollywood, of course, and a recession is real life. Still ... with spending expected to drop another 10 percent or more in half a dozen major tech-business categories this year, more than a few managers with IT oversight responsibilities will have to make like MacGyver through this fiscal year. Whether that involves scavenging for "nearly new" fiber-optic gear or repurposing outdated PCs as Web servers, the quality that will get you ahead in the early 21st century isn't vision. It's resourcefulness. These field-tested tips can help you reorient yourself.

 

Clean up your mess

It's a common problem: too many software packages doing too many similar tasks. The solution is to simplify. Electronics distributor Avnet (AVT) used to rely on two different customer relationship management systems. Each was also supported by different tech teams and databases. This meant that company managers couldn't use all their fancy software to track orders companywide. Databases were simply scattered in too many places. By replacing the mess with a single CRM system, Avnet global information officer Barbara Martensen not only saved her company a bundle on maintenance and support but also made it possible to get more complete information about customer buying patterns.

 

How are you saving money on high tech right now?

 

When deciding which platform to keep and which to kiss goodbye, start by comparing costs -- include licensing fees for each system along with maintenance expenses. Also, look for maximum bang for the buck. Would one system offer a bigger payoff than another if deployed companywide? All else being equal, go with the system that has been more widely adopted in your company, since users always whine when familiar tools are changed. The less whining, the better for everyone.

 

Open-source -- where it counts

Forget the zealots. Open-source software isn't ready to take over the world just yet. But it can be had for free, and in this economy, free is good. Raj Goel, chief technology officer at technology services firm Brainlink International, saved $50,000 by going with open-source Apache software for his Web servers instead of buying the commercial stuff. Goel is a big open-source fan, but he also believes that there's a limit to what it can do. Linux is great for routine networking tasks, for example, but don't inflict it on your workers as a desktop operating system. Likewise, don't expect Windows and Mac users to embrace open-source alternatives to Microsoft's (MSFT) ubiquitous Office suite. The free alternatives just don't measure up. Instead, open-source works best when powering systems behind the scenes, accomplishing tasks such as serving e-mail or powering firewalls.

 

To decide if open-source software is right for you, talk to your techies. If they're already juggling a mix of platforms, such as Windows and Unix, they've probably fooled around with open-source servers and development tools. On the other hand, if they're dedicated Windows developers, you should probably give open-source a pass.

 

Buy used

Ken Smith is an engineer at networking-gear maker Equipe Communications. A few days after visiting a friend at Texas A&M University, he decided to check out eBay's (EBAY) auction site to buy a souvenir of his journey -- a Texas A&M hat, perhaps, or maybe a sweater. The school's logo looks like "ATM," the acronym for the networking protocol asynchronous transfer mode. When Smith typed the three letters into the search box, he found himself staring at page after page of listings for barely used high-end ATM networking gear. "So we decided to investigate further," he recalls. Smith's golden blunder ultimately helped Equipe save $750,000 on networking hardware.

 

When buying used, look for equipment that doesn't require much customization, like Intel-based servers (INTC), computer monitors, or cards you can simply slip into your existing gear. From rack-mountable Compaq Proliant (CPQ) servers to high-end Cisco (CSCO) routers, if you want it, you'll find it for sale online. Scan local papers for bankruptcy announcements or contact a liquidation auctioneer such as Bid4Assets, Cowan Alexander, or DoveBid. But before you go bottom-feeding, do your research: You should know exactly what you're looking for and how much it costs new. That's how Smith picked up $10,000 worth of single-mode fiber-optic cable for just $350. No one else knew what to make of the mess of wires piled up in the corner at a bankruptcy auction, but Smith had done his homework. So should you.

 

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