15 Apr OEM versus TPM: What is Right for American Businesses?

Working Toward a Forward-Focused Federal Government

Every year, the government awards millions of dollars in federal contracts for IT maintenance and support. The lion’s share is currently going to the OEM, the Original Equipment Manufacturer, even though there is a much less expensive alternative, TPM (Third Party Maintenance). The heart of the issue is that many of the Federal requests are written “Manufacturer Only,” thereby eliminating TPM from the start. The question must be asked, especially in the current economic climate, is the most expensive IT maintenance solution best for America and American businesses?

The most likely reason for this practice is the manufacturer is a known commodity, and the users feel comfortable with the OEM’s maintenance and support. Doing so is understandable, and in normal times the easiest option may suffice. However, these are not ordinary times, and less expensive options such as TPM should be strongly considered.

During this unprecedented economic time in our country, doesn’t it make sense for the Federal Government to explore any option that is a cost-savings, such as TPM? Gartner, the number one global analyst firm, recommends a Hybrid Maintenance Strategy that incorporates both OEM and TPM. Simply put, the strategy is to place newer assets under OEM and older assets under TPM maintenance. The Hybrid Strategy is becoming the standard in the commercial hardware support market. We must ask if a Hybrid Maintenance Strategy is “Best Practice” in the Commercial space, shouldn’t it work in the Federal space as well? (see infographic “What is a Hybrid Solution?”)

Third Party Maintenance providers offer substantial benefits, including:

• Lower maintenance prices: By going with third-party maintenance, businesses can save 50-80% over OEM costs.
• Extended life of current hardware: OEMs favor a new hardware sale over a maintenance contract. There is no need to upgrade equipment early, especially if the equipment is fully functional.
• Support for multiple manufacturers: Third Party Maintenance providers can cover all of your hardware under one contract.
• Flexible SLAs.
• Qualified engineers: If you have different network equipment products, you won’t find OEM service offerings that will provide support for equipment other than their own.
• 24/7/365 part availability.

Let’s encourage the Federal Government to review its maintenance support agreements and do what is right for America and American businesses. Most organizations will significantly benefit from using a third party maintenance provider. According to Gartner, the benefits of third party maintenance services are substantial and should be considered next time your OEM support contract comes up for renewal.

Should you have additional questions about TPM or solutions that may benefit your business, contact Smart 3rd Party today or call us at 800.583.3894.