Maximizing Lifecycle Support for OEM Equipment: End of Maintenance Preparation

As technological advances increase the size and complexity of enterprise networks, more companies are considering a shift from OEM service and support in favor of third-party maintenance. Research from Gartner (1) found that while support contracts from OEM and TPM offer similar coverage, businesses can save from 30-50% by choosing a TPM. Third-party manufacturers can also provide support beyond the equipment’s end-of-service-life date, a point in which OEM warranties inevitably expire.

But third-party maintenance companies offer additional, substantial benefits as well.

  1. Extend equipment life. TPM can help a company to get the maximum value out of CAPEX investment. Extending the use of functional physical assets is a top priority for 78% of IT managers, who have turned to third-party maintenance companies to help keep valuable equipment for the full potential service life. Getting the maximum value from capital expenditures has a direct effect on the bottom line of the business.

  2. Lease-back option. Some TPM companies, like Maintech, can purchase a CAPEX investment and lease it back on a per-site, or per-node basis. This transaction changes CAPEX to operating expense (OPEX), which offers the enterprise more flexibility with expenditures and provides better returns for stakeholders, making inter- and intra-company cost allocations much easier.

  3. Asset discovery and reporting tools. A third-party maintenance company is not limited to monitoring equipment from a single manufacturer only. Maintech can provide detailed asset discovery and reporting tools to provide a comprehensive infrastructure overview independent of OEM origins. All relevant assets are included, regardless of manufacturer, so that your company has a full view of physical assets that spans not just different OEMs, but also different data center and multi-national locations. Clients can review their infrastructure as a whole, and leverage opportunities to reallocate assets for overall network function improvements and cost savings.

  4. Focus on service, not sales. OEM companies have a primary focus on selling product. Service is often an upselling opportunity for an OEM, but whether providing software or hardware, the measure of success for an OEM is sales. A services-only TPM, on the other hand, is in the business of providing a service. There is no divided incentive; if TPMs focus exclusively on service, then there is no measure of success for a TPM other than delivering custom service solutions to clients.However, a TPM that includes product sales as part of its offerings to clients is subject to the same non-service revenue generation imperatives as an OEM. Service-only TPMs are the best way to ensure that your company is receiving premium services without being encouraged to invest in equipment before it is necessary.

  5. Optimized overhead costs. OEM companies have to support considerable corporate overhead. Not only is there money to be invested in research and development, but OEMs may also manufacture products and develop software. The overhead to support these functions may be built into product prices as well as service contract prices. A third-party maintenance company, however, has a custom-built service delivery infrastructure. Service contracts are not padded to support the cost of other aspects of the business; clients pay only for services they receive.

A proper asset management strategy must take into account both maintenance and reliability. Maintenance refers to the tactical, short-range management of assets and equipment; reliability plays into the long-term, strategic approach of forecasting need and avoiding failures. While maintenance and reliability are interrelated, the priorities of each must be managed for the overall health of the business.

A third-party maintenance provider has the client’s needs at heart. Without any loyalty to a specific OEM, a third-party maintenance provider can help to extend the lifespan of equipment and provide support beyond the EOSL date specified by the manufacturer. In addition, TPMs can help you to find the optimal mix of CAPEX and OPEX, provide asset overview reports, and make your priorities their priorities without a hidden agenda.

Does Maintech service your equipment?

  1. Competitive Landscape: Partnering With Third-Party Maintenance Providers for Data Center and Network Maintenance Cost Optimization

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