3 Factors Driving Faster Network Equipment Refresh Cycles

Among their many responsibilities, IT executives face few issues as crucial as determining network equipment refresh cycles. Here are 3 factors that are moving enterprises towards an aggressive refresh cycle in today’s data-driven, global marketplace.

1. Insider Advocacy

More than a decade ago, IT insiders participating in an industry report pinpointed a general refresh cycle of three to five years as optimal timing. And when it came to equipment in fast-developing critical fields such as security, they favored timelines of three years or less.

Fast forward to today’s business environment where network flexibility, agility and responsiveness are required across all industries. Implementing a favorable network refresh cycle enables businesses to meet customer demands and keep pace with the latest digital advancements to help drive success.

A 2017 Gartner survey reports that IT budgets will markedly increase to support digital transformation, with top performing businesses earmarking 44% of their IT budget on the effort. Additionally, CIOs report pressure from their boards to digitize faster and networking is a critical element of that effort. Whether companies and their boards will be comfortable with refresh cycles greater than three years in this environment remains to be seen, but it’s doubtful.

2. Technology Demands

The growing need for higher capacity and advanced features is pushing network professionals to accelerate refresh cycles§:

  • 44% said that the deluge of wireless endpoints was the foremost driver in refreshes
  • 41% cited modern networking capabilities — including security — as a reason
  • 33% said that the need for increased speed, due to the increasing adoption of gigabit wireless (802.11ac), was the primary driver

Keeping up with the rapidly changing technology landscape means your refresh cycle might not match up perfectly with technological advancements. If that’s the case, a strategy that employs an operating lease might be just what you need to get in and out of technology quicker.

3. Competitive Pressure

Research conducted by Dimension Data in 2016 found that 58% of enterprises had new network devices in place. This represented an 11% improvement from the prior year which reversed a five-year streak of stagnation. In nearly every case, such current technology translated to enhanced productivity through more reliable network connections and support for the most up-to-date services available. 

Sitting on the sidelines as competitors upgrade their network equipment and capabilities won’t sit well with any business leader. That means there’s a good chance this move toward newer, more capable equipment will lead to a technological arms race and the winners will be the companies that implement a faster refresh strategy early on.

A Refresh for the Refresh Cycle

These three factors suggest that businesses whose plans are predicated on an accelerated network refresh strategy have the potential to increase productivity, minimize risk and meet or exceed customer expectations in a digital-dominated world. 

A key advantage to balancing assertive operational investment and sound financial decision-making may lie in the strategic use of operating leases. We can help.

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When to Upgrade: Insiders Share Rules of Thumb about Equipment Lifecycles. Network World, 2005. 

Survey of More than 2,500 CIOs Charts the Rise of the Digital Ecosystem. Gartner, October 17, 2016.

§5 Reasons to Upgrade Your Network Switch. Enterprise Strategy Group, October 19, 2015.

Dimension Data. Network Barometer Report 2016.

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