Study: More IT Executives Turning to Leasing

As per seen in the Monitor Daily

Procuring IT equipment through leasing is one option to better manage technology assets, according to a poll of senior IT executives conducted at Forsythe Technology's 2006 Executive Customer Council.

The survey found that 38% of participants report that simplifying technology refresh is one of the most compelling reasons to lease IT solutions.

"Even companies with substantial cash reserves discover there are better ways to use that cash than tying it up in depreciating assets such as IT equipment," said John Carcone, senior vice president of financial services at Forsythe.

"As interest rates increase and money gets more expensive, it's important to determine the best method for acquiring and financing needed IT equipment," Carcone added. "One option is leasing, which matches the company's financial commitment and internal useful life projection, plus provides fixed scheduled payments to simplify expense budgets, offers a hedge against rising interest rates, protects businesses from inflation and allows companies to project future cash outlays with greater accuracy."

The survey also found that IT executives continue to have issues with estimating the useful life of IT equipment and matching it to business goals. Seventy-five percent of respondents said that the estimated useful life of technology is the most important factor they use in determining IT investment decisions, but almost half (45%) say they inaccurately project the useful life at least 40% of the time.

"Working with a trusted advisor that understands technology lifecycles and provides flexible terms for upgrading and refreshing equipment can help companies make proper procurement decisions," Carcone said.

Twenty senior IT managers from a broad range of companies representing nearly $130 billion in aggregate revenue in the industry were surveyed during Forsythe Technology's 2006 Executive Customer Council.

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