Hardware Refresh Policy, Help

The company I work for is rather small, we have about 60 desktops and run 4 servers.

The desktops range from Win XP, Core 2 Duo to Win 10 with Core i7. The newer desktops are used by our engineering staff (architects and civil/structural engineers) the older desktops by the admin staff.
Our servers, 1x DC, 1x Exchange 2010, 1x file and SQL server and 1x backup server. These servers have been in play since late 2010 early 2011, they are still running fine barring a few RAID failures in the past.

I am now required to setup a refresh policy for all hardware.
To date the company has worked on a 5 year refresh period for all workstations and a 10 year refresh period for servers, I don't feel that is ideal.
I thought I would start off with hardware that is of "mission critical".
Our engineering staff tend to do carry most of the work load in the company so I thought it would be a good ideal to have those desktops on a 3 year refresh, this way they are able to stay up to date with software changes.
The admin staff mainly use Office packages, ironically most of these desktops are still run just fine with Win XP and Core 2 Duos, sticking to a 5 year refresh should be fine
Directors and top management would be on a 3 year refresh, they are basically the heart and brains of the company so don't want them breathing down my neck about slow hardware.

Now the servers are running fine, no problems, performance is good, all is peachy... but... with these servers being the age they are they have long gone passed their warranty period, if a server had to have a main-board failure now it would mean weeks of down time trying to source a replacement or even to replace the server entirely.
Now my gut tells me to work on a 5 year refresh period and also to consider virtualization, one powerful server to tun 4 VMs and then use the old hardware as failover servers.

Do you guys have suggestions for me, what would do?
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
So now you need to look at virtualisation, and creating another Domain Controller at least, two are better than one.

So you have a choice of Microsoft Hyper-V or VMware vSphere.

and if you use virtualisation, and put all your eggs in one basket on a single server, what resilience are you going to design in and how ?

and do you have a budget for this?
In my point of view hardware doesn't really need a strict replacement policy. Replace it when it dies, or gets too slow to work on. Core 2 Duo CPU's are still very good and can cope with most tasks.

It is much more important to keep your OS's up to date. Particularly get rid of XP, as that has had no support for over an year. Using unsupported OS's is risky and opens up many ways of getting at your data or corrupting it. Always make sure you replace an OS before it's official end of life, m$ usually has roadmaps for their OS's where you can see it's life-span, giving you enough time to prepare for it's replacement.

Windows 7 or 10 works fine on Core 2 Duo CPU's.

For the servers I'd also go for virtualization. It makes it easy to move from one server to another should one break down.
DJMohrAuthor Commented:
@ Andrew

Virtualization is definitely at the top of my list, I am considering running 2 Windows Hyper V servers, one as the primary and the other as a failover.
Budget is a bit hard to determine, considering the current $/R exchange rate it could very well be well over 100k

@ rindi

The whole break fix approach is working out costly, at times the break is so bad a complete replacement is needed resulting in unwanted downtime, as for the OS's, they are in the process of being phased out.
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Just have some spare PC's around you can use to replace broken ones with. Besides, also new PC's can break down completely, so you'd have the same amount of down time with those.

In my point of view one justified reason for replacing PC's before they break down would be if you are going to sell them. If you wait for too long you may not be able to sell them for a good value, even if they still run fine.
harold mcmullennetwork techCommented:
seeing that xp isn't supported anymore...why have xp?
that said, a 5 year replacement sounds good on the workstations. here is our policy...we buy the least expensive workstations and a 5 year warranty (2 day parts and service turnaround). at least all of the workstations are taken care of for 5 years.
same for servers, also w/ a decent warranty. I honestly never heard of a 10 years replacement of pc's or servers, especially with how fast technology changes.
Bryant SchaperCommented:
I personally prefer a formal refresh policy:

Desktops 4 -5 years
Laptops 3 -4 years
Server 4 - 5 years
Networking 6 - 7 years

Some of this can be subject to your environment, if you are not bleeding edge on the software you may get more time out of the hardware before replacement.  I would also recommend you are purchasing from a vendor like HP, Dell, Lenovo, IBM and not building your hardware.  Sense they provide warranties you can gauge your replacement schedule according, they keep parts on hand for replacement for you.

Now something can be said for keeping you OS current, but sometimes LOB applications do not support the latest operating systems or they are too costly to upgrade that frequently so this needs to be factored in as well.

I have worked for a few organizations that the software requirements changed very little over 10 year span, as a result we had no reason to replace hardware other than technical support for that hardware and availability of replacement hardware.  This was the driving factor on our refresh.  

I think you certainly can consider virtualization as an option as well, but you need two servers not one.  Eliminate the single point of failure or all is lost.

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