Hardware maintenance is usually provided through a defined service contract

Hardware maintenance is usually provided through a defined service contract negotiated between the organization purchasing the hardware and the vendor selling the hardware. At the heart of the maintenance contract is the response time in which the vendor repairs the issue. This is a major factor in the cost of the maintenance agreement.

Consider the following two policies.

- Setting aside a budget of $100,000 and purchasing a reserve of hardware components and fixing hardware issues with internal staff.
- Purchasing a maintenance contract for $200,000 that guarantees all repair services will be completed in a 4-hour window from the time they are reported.

In your view, which of the two policies listed above would be the most beneficial to an IT department's budget? Explain, indicating the major factors that influenced your policy decision.