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Support and Upgrades: Determining the Real Cost of Software

Apps & SoftwareHardware & Software

When you buy computer software, the purchase price is only a fraction of the real cost. In fact, the greatest "cost" of computer software lies in the installation, training, maintenance, upgrades, troubleshooting, and time lost due to system failures and lack of user training. Many consultants estimate these expenses at 40 to 60% of an application's total cost.

A good support and upgrade strategy won't eliminate these costs, but it will help reduce them to a manageable level. Keep your tools (and your users) sharp, and you'll keep software downtime to a minimum.

Determining the real cost of software

What is the cost of software support? 

Some businesses view formal software training as a boondoggle. This is a big mistake. Users who get formal software training make better use of their computers more quickly. When users don't get proper training, they rely on the "shadow support" of more experienced users who usually have better things to do with their time. Either way, your business pays the price. If formal training isn't an option, consider alternatives such as self-paced tutorials or video training guides.

Vendor technical support is a major source of trouble for small offices. The 90 days of free support included with a standard software license may cover short-term installation and hardware compatibility problems, but you'll still need long-term technical support. This can get very expensive, depending on how many people and how many different products require support.

In addition to prepaid support packages, most software vendors run pay-per-use support lines that charge users each time they call. At $25 or more per call, these can add up quickly.

There are ways to control technical support costs. Encourage your users to try free sources—in many cases, software companies can answer the most common support questions. Larger firms should consider hiring in-house support staff or third-party services, both of which might be less expensive than vendor-run support packages.

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What are the costs of software upgrades? 

There are two kinds of software upgrades: version upgrades and bug fixes. Bug fixes are usually much more frequent, and you should apply them as soon as they become available—in some cases they correct major software performance or security problems. Version upgrades include fundamental changes to the software, and they're much less frequent. Major upgrades are potentially more disruptive to your business, however, and you should handle them with care.

Some guidelines for dealing with upgrades:

  • If it ain't broke, don't fix it. This applies to computers and software with a vengeance. Wait for a compelling reason to upgrade.
  • Don't be a guinea pig. Market pressures sometimes force vendors to release software before it's ready. Beware of major software releases, and use special caution with an initial "version 1.0" release. As a rule, it's a good idea to wait for the first general bug fix release (such as "version 1.1" or "version 2.01") before you upgrade.
  • Send a scout. Check online discussion groups to see what went wrong on other users' machines when they upgraded. Then, before you upgrade all the computers in your office, upgrade one typical machine and test the software on it.
  • Yield gracefully. In spite of the costs of upgrading, software really does improve over time, and there are real costs to not upgrading. One of the most common reasons to upgrade is to maintain compatibility with clients and contractors that use the same software. New features can also increase your productivity, and introducing those features gradually by following the vendor's upgrade schedule can ease the learning process. Finally, depending on the vendor, it might cost less to buy a series of minor upgrades than to wait and pay full price for a major upgrade.

Control software costs through bulk discounts

Lastly, another way to control the cost of your business software is to strategize your purchasing to take advantage of bulk discounts.

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