Home

About Us

IT Services

Understanding IT

News & Events

Blog

Support

Contact Us

Blog
  • Register

Texas Professional IT Services LLC Blog

Why You Need to Know the Difference Between “Value” and “Cost”

Why You Need to Know the Difference Between “Value” and “Cost”

There’s no denying that the numbers on an IT invoice can be intimidating, to say the least. However, when making important decisions about your IT, you need to also look deeper than the numbers, to what you are actually going to gain by making one investment over another. This is the difference between comparing cost and comparing value.

Analyzing Cost

The word ‘cost’ is one that is familiar to most. In essence, it is what you have to give up in order to receive something else. While it is perhaps most familiar in the financial sense, cost can also refer to time, effort, or any other finite resource. By analyzing cost, you are directly focusing on how much less of one of these resources you will have, in the exchange for more of another.

Don’t get us wrong, it is important to factor in your costs as you evaluate your business’ plans. The problem comes into play when cost is the only factor that is considered, as cost only tells half of the story.

By its nature, analyzing cost strictly focuses on what you lose. What resources will you be sacrificing to do this? How much money will doing that put you back? What will you be unable to do if you take this course of action?

In order to properly make a fully informed business decision (or any decision, for that matter), you have to also consider the other half of the story as well: that decision’s inherent value.

Analyzing Value
Counter to the analysis of costs, analyzing the value that a decision will bring you can help you determine what you gain. While again, it is perhaps most often seen in the financial sense (“Is this purchase worth it?”), value can take many different forms. Sometimes, making a particular decision will boost your standing with a prospective client, or will open you up to more opportunities down the line.

So, rather than focusing on what a new workstation will cost you financially, compare that cost to the potential benefits that the new and improved workstation will be able to bring to your business. Will it increase your productivity? Will you have access to improved solutions that ultimately translate into improved employee satisfaction, and therefore, greater talent retention? Will you be able to better serve your market, fostering loyalty in new and existing clients?

Calculating Your IT’s Value
In order to establish how much value a certain endeavor or initiative has brought your company, it helps to compare it mathematically. Not only will this help you to track what you have invested into a given initiative, it will also help you to calculate the optimal outlay for maximum value.

To calculate this, it may take a little trial-and-error, with some simple tracking of the results. Using a simple “x=y” equation, insert your invested cost for “x” and the result for “y.”

Let’s assume you’re determining how much time to spend on a particular initiative. If, for example, you figure out that your investment into your technology increases productivity, you can track the ratio of productivity-to-investment until the benefit tops out and starts to fall again. Let’s further assume that you observe that investing $25 extra into a workstation increases productivity by 10% and investing $30 extra will increase it by 17%. If investing $31 only increases productivity by 16%, you’ll be able to narrow down your optimal spend to between $25 and $30, maximizing your value.

Texas Professional IT Services LLC can offer you the solutions that can provide you with maximum value. Reach out to us at (832) 514-6260 for more information.

Tech Term of the Week: Blockchain
What to Do With Your Old Power Converters, Accordi...
 

Comments

No comments made yet. Be the first to submit a comment
Already Registered? Login Here
Guest
Monday, October 15, 2018
If you'd like to register, please fill in the username, password and name fields.

Captcha Image

Mobile? Grab this Article!

QR-Code dieser Seite

Tag Cloud

Tip of the Week Security Business Computing Technology Best Practices Cloud Privacy Cybersecurity Network Security Managed IT Services Communications Malware Tech Term Smartphones Backup Productivity Communication Microsoft Internet Hardware User Tips Outsourced IT Hackers VoIp Software Android Browser Google Business Email Passwords Ransomware Efficiency Save Money Hosted Solutions Small Business Wi-Fi Social Media Innovation Windows 10 Data Smartphone Applications Miscellaneous Microsoft Office Business Intelligence Business Management Collaboration Saving Money Cloud Computing Data Backup Excel Settings Twitter Access Control Patch Management Computer Network IT Services Internet of Things Phishing Mobile Devices Data Breach Automation Data Recovery IT Support VoIP Data Management Managed IT Services Analytics Employer-Employee Relationship Apps Router Office Government Mobile Device Blockchain Bandwidth Users Computers Wireless Charging Windows Alert Office 365 Workplace Tips IT Support Artificial Intelligence Tip of the week Battery Virtualization Holiday BDR Cortana Spam Compliance Virus Website Scam Remote Computing Password Word Vulnerability Business Continuity Law Enforcement Gadgets VPN Data Protection Information How To Cybercrime Tech Terms Chrome Marketing App Dark Web Workers Physical Security Retail Wireless Networking Cost Management Managed IT Service Company Culture Gmail Politics Virtual Assistant Mobile Device Management Files Database SaaS Botnet Disaster Recovery Dongle Unified Communications Cables Business Technology HP Environment Google Maps Managed Service Remote Control WhatsApp Telephony Biometrics Antivirus Streaming Media Update Facebook Paste Tech Support User Tip Paper Microsoft Office 365 iPhone WannaCry Comparison IT budget Tactics GDPR Entertainment Printer Server RAM Voice over Internet Protocol Big Data e-waste Hiring/Firing Spam Blocking Voice over IP Access Staff Downloads Document Management Inventory Plug-In Machine Learning Ink Authentication Multi-Factor Security HIPAA Specifications Information Technology IT Management Maintenance Phone System Storage Remote Support Server Printers Technology Tips Microsoft Teams Sales disposal Staffing Email Management News eCommerce BYOD Websites Trends G Suite Paperless Office Mobile Security Proactive IT Travel Telecommuting PowerPoint Shortcut Authorization Hard Drive Managing Stress Conferencing Internet Explorer Error Smart Technology Backup and Disaster Recovery Tablet Laptop Value Reporting Telephone System Online Shopping Safety A.I. Bring Your Own Device Recovery Digital Operating System Automobile Remote Monitoring and Management Telephone Systems Education Millennials Telecommute Sports File Sharing Processors Hard Drives Amazon Hosted Solution Content Filtering Network Attached Storage Threat Gadget Google Drive Lead Generation Knowledge Medical IT Cleaning Movies Hybrid Cloud Managed IT Spyware Edge Analysis Live Streaming Remote Monitoring Data loss Connectivity Troubleshooting User Security SSD Copy Licensing Server Management Printing Touchscreen Two-factor Authentication Apple Thank You CrashOverride Outlook Congratulations WiFi Regulation Quick Tips Emergency

Latest News & Events

Texas Professional IT Services LLC is proud to announce the launch of our new website at http://www.texproit.com. The goal of the new website is to make it easier for our existing clients to submit and manage support requests, and provide more information about our ser...

Contact Us

Learn more about what Texas Professional IT Services LLC can do for your business.

Call Us Today
Call us today
(832) 514-6260

1209 Decker Dr.
STE 202

Baytown, Texas 77520