Project Description

    How Maxxia helped resolve a school’s ICT leasing issues

    A case study showing how leasing, when done properly, can be an ideal way for schools to ease the ever-increasing demands on IT budgets.

    Background

    ICT is playing an increasingly important role in schools. It’s not just the growing popularity of computer studies courses that’s driving this. Technology is now at the heart of the whole learning, communications and management process in modern education. Put simply, schools cannot get by without effective, up-to-date IT systems and networks.

    The problem is it’s not always easy to access the additional funds required to extend and update a school’s technology resources. This means looking to alternative means of funding which may include leasing. But how do you know you are getting a good deal? How do you avoid being caught out by hidden costs and penalties buried in the small print of a long, complex lease document?

    The last thing that school managers want when it comes to signing up to long leases is a rash of nasty surprises a few years down the track. They want to know – up front – exactly what their commitments are each year and what they have to do to avoid any unexpected additional charges.

    Most important of all, schools want to deal with a leasing company they can trust, one that understands that teachers and school managers are not financial experts. They want total transparency, honesty and fairness.

    The Green School’s ICT challenge

    The Green School, a girls’ secondary school in Isleworth, West London, found itself in a fairly typical situation. Teachers and school managers knew that some of their ageing servers were creaking and that their performance was starting to have a direct impact on the running of the school.

    So they called in an ICT supplier they had been dealing with and asked for their advice.

    It turned out that the school needed a lot more than just a few replacement servers and ended up with a long list of requirements including a wireless network, extensive recabling, new desktop PCs, a virtualised desktop infrastructure, interactive whiteboards, and projectors as well as new servers.  The total cost ran to several hundred thousand pounds.

    The ICT provider introduced the school to two companies to handle the leasing and finance of the equipment, one of which was Maxxia, whom the school selected on the basis of its capabilities in this area, as well as its competitive, transparent approach.

    But Maxxia’s contribution went further than this. Not only did Maxxia provide exactly the right lease and asset management solution, it was also able to help the school recover some significant sums from the leasing company it had used to fund its previous ICT equipment.

    The role of Maxxia

    In order to comply with the strict rules many schools face on funding, Maxxia put together an operating lease for the Green School to fund the cost of its new ICT, which came to almost £500,000. This effectively meant that the school rented all the equipment.

    But, as it always does with all its clients, Maxxia bent over backwards to make sure that the school’s managers and governors knew, up front, exactly what costs they would face during the course of the lease. They also briefed them in detail about all the implications of replacing kit early, extending the life of other components and dealing with the key issue of sustainable disposals. For Maxxia, and unlike some rivals, this is an ongoing commitment: when changes in personnel led to the school hiring a new business manager and new ICT staff, Maxxia came back to ensure that these people too were familiar with the ins and outs of the agreement.

    Maxxia also worked hard to structure payments that fitted in with the school’s cashflow and funding schedules.

    “Due to budget constraints across many areas of the school, we needed a lease structure that was both affordable and sustainable. Maxxia came up with a structure that suited us perfectly; allowing us to proceed with immediate and on-going IT requirements across the school”, says John Wiffen, Director of Finance at The Green School.

    As part of the deal Maxxia also provided the school with a comprehensive asset management tool which allows the school’s managers to keep track of all its lease contracts and obligations and maintain accurate records of the status of all the school ICT equipment. This enables them to have a real time picture of their IT assets and financial liabilities throughout the course of the lease.

    But Maxxia was also able to help in one other critically important way. The school had received a substantial bill from its previous leasing company for a payment apparently due under the terms of its historic lease contract. Maxxia investigated the paperwork and helped the school to challenge the company’s claim.

    The net result was that the school was able to recover almost £50,000 from the previous leasing company. That’s more than the cost of a teacher for a whole year.

    “Without the help of Maxxia, the school would have been £48,000 out of pocket. What was refreshing was that Maxxia was not looking to gain anything out of it; it just formed part of their transparent and honest approach to relationship management”, continues Wiffen.

    Looking ahead

    Maxxia is continuing to work with the Green School, educating them about the world of leasing and making sure that they avoid all the things that can go wrong for schools when it comes to dealing with finance companies.

    For Maxxia the watchwords are always the same: honesty, transparency and openness are all crucial, especially when dealing with schools. Maxxia also reminds everyone that when it comes to leases, the devil really is in the detail. The advice is to never sign anything unless you understand every word of a lease and know exactly what your financial commitments will be in every circumstance.

    Maxxia is also keenly aware of the need to maintain a complete picture of all costs and assets under lease. Likewise, key issues regarding the obligations of schools concerning sustainability are always high on Maxxia’s agenda.

    “Schools are the lifeblood of our economy, producing the skilled workforce of the future”, says Steve Bellamy at Maxxia. “It is our corporate responsibility to ensure that we assist in securing them best value and treating them with honesty and respect. Schools operate multi-million pound budgets but sometimes lack essential commercial experience regarding leasing. At Maxxia, we believe that it is our role to provide this as part of our service and let schools get on with providing the best teaching and learning experience they can.”

     

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