Everyone wants the best deal at home and at work. Comparing prices and services is simply part of evaluating the entire value proposition and total cost of ownership.
Initial purchase price often becomes the primary factor when value hasn’t been clearly explained and isn’t understood. In the security industry, price is even more significant. This may be because budgets are tight or there’s a low-bid requirement for a project. The initial cost may become the singular focus, which is dangerous.
There’s a significant difference between the initial cost and the total cost of ownership. When extrapolated, the total cost of ownership diminishes the significance of the initial cost because the initial cost is only one component of a more complicated cash flow.
Total Cost of Ownership has several key components:
- Cost to Evaluate
- Cost to Purchase and Install
- Cost to Operate and Maintain
- Cost to Add and Upgrade
- Cost to Change:
Cost to Evaluate
The time and potential cash outlay to evaluate a solution can be staggering. If a company is going to sit through presentations by multiple installation companies, the dedicated person-hours must be considered. The end user will have a few rounds of these meetings to rule out options. This typically involves many people from various parts of the organization. After initial discussions and presentations, some organizations will request a proof of concept or even a pilot program. A proof of concept demonstration can take the good part of a day or two to setup and demonstrate to a handful of stakeholders. A pilot program can involve temporary or permanent deployment of a sample solution for the end user to be comfortable with the final solution.
Cost to Purchase and Install
This is the bid or proposal containing the parts list. Installation cost usually goes hand in hand with the equipment parts list. What is often overlooked, is the complexity of the installation which significantly impacts the installation cost.
Cost to Operate and Maintain
Once the system, whether video surveillance, intrusion detection, or other technologies are installed, staff to operate and contracts to maintain the systems must be considered. A simple solution may require one operator to respond to alarms and view video feeds, but a complicated solution may require more staff to triage and direct response resources. In unmanned systems, equipment reliability may impact the solution. Unreliable devices or components with short mean time between failure (MTBF) periods may cause increased maintenance concerns and increase the total cost of ownership. This is one of the most hidden and costly expenses related to security solutions.
IP solutions require scheduled health checks, firmware updates, software program updates, and Windows updates and patches for workstations.
Many systems also require annual software maintenance agreements (SMA) which are not usually on the initial proposal.
Cost to Add and Upgrade
Inevitably there will be an operational adjustment, end user request, or new technology that will require a change. It is critical to understand the timeline of the system components in relation to the end user’s expectations for system operation and functionality over a 3 to 5 year period. Several common considerations include:
- Camera additions
- Computer hardware replacements
- Additional credential readers
- Changes in policies which cause changes in security requirements
Cost to Change
Proprietary infrastructure is a common tactic among manufacturers to lock you into their technology. Protect your investment by choosing open architecture whenever possible for the heart of your systems.
The Vision Security Technologies team has a wide range of resources available to properly evaluate and plan your next security solution from a total cost of ownership perspective. Once the evaluation is complete, you’ll have a comprehensive plan of action and the budget preparation details for securing your facility. Contact Vision Security Technologies for more information and to get started. 888.773.6762