I chuckled when reading CIO.com's attempt to guide CIOs to new ways to afford overpriced enterprise software. SaaS was one idea (and a good one). The other? Financing the software through the vendor. Now there's a bad idea...
Whatever you think of the "benefits" to the customer, [Forrester Research's] Wang thinks the financial ability that vendors such as IBM, Microsoft and Oracle have to provide financing deals to their customers is critical, especially given the horrific state of the economy. "Vendor-led financing initiatives may prove to be the lubricant that keeps tech spending moving forward," Wang says.
Guess what? The economics of enterprise IT spending are little different from household spending: if you can't afford it, don't buy it. It really is that simple. (See the Saturday Night Live clip at the bottom of this post. Classic.) And if you're buying software that is so expensive that you have to finance it, you're buying the wrong software.
"But I really need that new ERP or CRM system," you cry! Guess what? We're long past the day when paying exorbitant amounts of money for software was the only solution. Nowadays we have newfangled things like open-source software (acquisition cost? $0.00) and SaaS to bring down costs and let the buyer get only what she needs. If it doesn't work, you dump it and move on.
Still scratching your head, wondering where to begin? Computerworld offers a buyer's guide to getting equivalent or better functionality with open source, at a negligible price point. Software that you can afford, and which gives you the performance, functionality, and price that you need.
All without taking out a loan with your vendor, perhaps one of the silliest mistakes you could possibly make. Feel better?