Why old computers cost your business more

How old is the computer you use? When is it time to replace? Or do I keep using it till it dies? As a consultant, I get asked these questions quite frequently.

What if I told you your 5 year old computers could be costing you $1,500 per employee per year!
Old Computer vs New Computer
In some ways purchasing computing technology is like purchasing a car, and whilst some people like to buy new cars and turn them over every 5 years or so, or before they reach 100,000km’s, some people will buy a car and keep driving it till it’s full of rust and blowing smoke!

And that’s the reality of the computer life-cycle as well.

It’s a little scary for me to walk into a business and see computers that are 5 or more years old! I almost want to reach out and hug the poor staff member who’s using the computer, perhaps unaware how many of the problems they face every day, including the pace by which they can work, is all tied to that tired old beast rattling away under their desk!

So what should you expect to get out of our computing investments and more importantly, WHY should you change the way you currently replace your computers?

Let’s start with the latter – why should you change your way of thinking? And let me say straight up, the profit margin on computers these days isn’t significant enough that I’m writing this article in the hope to increase computer sales. I’m not. If I made a living on the sale of computer hardware I’d be looking for another occupation!


If you’re an astute business owner, you’ve learnt the value of purchasing computers with a proper warranty, rather than using a computer that was pieced together by the local computer shop, that when something breaks, you’ve got to take the whole box into them, get them to work out what’s wrong, pull the part out and hopefully replace it on the spot – if they have the part! Or, as more often happens, have to wait whilst they send the part away to be ‘tested’ by the distributor before you finally get the part back.

Meanwhile you’re losing time travelling to and from the store, and if you don’t have a spare computer in the office for such an occasion, you’re instantly down a computer for an unknown length of time.

Most of the tier 1 brands will either include as standard, or offer as an option, a 3 year warranty which includes on-site labour and part replacement. We use and recommend Lenovo, however HP and Dell both do a pretty reasonable job of this as well. The real benefit to you here is that when the computer has a problem, Lenovo will send out a technician, at no cost to you, to replace the part, and generally within a very short space of time.

These warranties are usually 1 to 3 years. When we sell a client a computer, we always include a 3 year warranty. In fact I won’t sell a computer without a 3 year warranty anymore. I do this because I don’t want my client to have problems that result in them having to wear unnecessary costs.

Computer Speed

Moore's LawAs a result of a thing called Moore’s Law (named after Gordon E Moore, co-founder of Intel, the primary producer of CPU/Processors), the performance of microprocessors doubles approximately every two years.

In 1965, Gordon E Moore made the observation that the number of components used in a circuit doubled every year since the invention of integrated circuits in 1958, up until 1965, and predicted that this trend would continue “for at least ten years”. This prediction has proven to be uncannily accurate, partially because the law became a basis for the semiconductor industry to guide their long-term planning and help them set targets for research & development.

So what does this all have to do with the age of your computers and how slow they are running?

Quite literally it means that replacing a 4 year old computer with a new computer will result in a 75% computing speed increase.

Many people have gotten used to their computers running sluggishly, as if it’s how things should be. It often makes me chuckle when we replace 5 year old computers with new ones and the staff squeal with joy over how “much faster this thing is”.

No doubt you’ve noticed that over time your computer feels slower? This is because of a number of factors including the simple process of installing software and software updates, which at a very basic level, create an additional level of disorganisation with the way your computer works which impacts the speed of the computer. Some of these things we can improve with regular maintenance, whereas others the only solution is to format and start all over!

After a few years it’s not uncommon to find that simply restarting a computer can take 10 to 15 minutes! Imagine what the cost is to your business if your staff are rebooting their computer even once per day! That’s 1.25 hours per employee per week, or 60 hours per year, that they are unable to do their work, all because of old computers.

If that same employee costs $25 per hour, it’s costing your business $1,500 per year to keep that old machine. YOU COULD BUY A NEW COMPUTER FOR THAT!

With this in mind, it makes sense from a performance perspective, to ensure your staff are using the most efficient tools to do their jobs. Every delay they experience, which could be overcome as a result of a shorter hardware replacement process, adds up.

We recommend 3 years, as we feel after that you are starting to cost your business by creating delays in how efficiently your staff can work. As a matter of interest, the ATO considers a computer to be 3-4 year investment!

New Software

Most software applications upgrade every year. Every new upgrade generally wants more memory, needs faster processing power and creates an additional burden on the hard drive (storage device).

Why’s this?

The simple answer is that the people developing the software aren’t using 5 year old computers to develop it, and they don’t want to be developing software for people who are using old computers because this limits what innovative new features they can add and what advances in software technology they can leverage to use in their software.

You may say the best answer then is to keep using the same version of the software for 5 years, or until you have to upgrade.

But why? You want your business to be a competitive force in your industry, don’t you? So why disadvantage yourself by denying your business the opportunity to leverage new technologies?

I LOVE telling business owners about the bank reconciliation process that Xero (the online accounts system) introduced and which now other software applications are rushing to implement.Innovation like this creates an awesome amount efficiency for small businesses by helping to automate some of the most mundane business processes.

Obviously Xero aren’t the only people being innovative, but with new software versions, often comes new innovative features which your business can use to help make those people driven processes automated. Imagine if you could continue to grow your business, without having to add as many staff? That sort of scalability will go straight to your bottom line. Isn’t that what YOU as a business owner or manager want?

ostrichAnd of course it’s not just about innovation, sometimes the upgrades are about security. Something I would hope is important to your business as well! Whether it’s a patch to fix a potential security problem, or a way to increase the protection of your data, these are things you want to take advantage of.

Sticking your head in the sand and using 5 year old software so you don’t have to keep “spending money” on new computer software and hardware is as pointless as an ostrich thinking it’s safe from predators by doing the same.

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