Buying Is Not Transforming: Chief Financial Officer's Framework for Governing Vendor-Replacement Capital Expenditure in Enterprise Information Technology

There's a constant and often overlooked source of waste in enterprise technology budgets replacing perfectly good platforms with newer versions that may not be necessary for business. What could be called vendor-change addiction is explored in this article, where new information technology leaders are quick to announce platform changes as a sign of change, but the business processes don't. The analysis is based on documented market disruptions such as Broadcom's acquisition of VMware and the Cohesity/Veritas data protection business, and empirical data from main Consulting Group, on the failure rates of enterprise resource planning (ERP) initiatives. Twelve illustrative scenarios are provided that span the areas of backup, networking, service management, enterprise resource planning, cloud, virtualization, storage, firewalls, endpoint security, security information and event management, customer relationship management and analytics. It measures hidden layers of costs that are seldom included in purchase proposals, includes three worked financial comparisons and a chief financial officer approval checklist. The main idea is clearly stated. If you have a new product, it's a cost. Meeting the met business requirement is a plus. Only the second is allowed by the first.