Barnicoat often finds that his organization doesn't need to upgrade tothe latest version of a program, and then he decides whether to deferor refuse the upgrade. Recently, he decided to forgo an upgrade toWindows XP.

"We won't do it," he says. "Right now we're paying 25 percent a yearfor maintenance, and they want 29 percent if we upgrade. We can'tafford it, and we don't need it. So my position is we'll wait untilour current licenses run out over the next four years."

Mark Settle, CIO of Arrow Electronics in Melville, N.Y. (2000 profitmargin: 2.8 percent), says he will also delay a move to Windows XP.Settle anticipates saving between $2 million and $4 million byupgrading from Windows 98 to XP in a year, rather than doing so now."We're just moving the cost out, but when we spend the money we willbe spending it more effectively," he says.

Another reason Settle thinks it's more valuable to delay the upgrade:The longer he waits, the more time other early users will have todiscover and fix the inevitable bugs in the system. If the bugs havebeen patched by the time he upgrades, that's a more effective use ofhis money, he says.

Subbakrishna of Mercer Management says upgrade delays can saveshort-term dollars, but they come with a caveat: the need to considerwhat will happen if the vendor stops supporting an older version of asoftware product.