Many authors, including myself, have written about the benefits of the cloud in its many forms, yet there have been very few detailed case studies on the hard benefits and savings we expect. Given the dearth of hard evidence, I felt many would benefit from the results of a recent private cloud study by Forrester.
Forrester Research performed one of its forward thinking Total Economic Impact™ (TEI) studies on the potential return on investment (ROI) enterprises might realize by leveraging a private/hybrid cloud model, versus a traditional CAPEX communications solution approach.
Forrester took a look at how cloud services for unified communications and contact centers are benefiting five companies. They interviewed companies that had outdated legacy communications environments that included different types of solutions.
In several cases, the companies had solutions managed by disparate third parties providing inconsistent service experiences. Costs were increasing. All of the subject companies had a goal of reducing capital expenditures while transforming and evolving their communications environment. The five companies consisted of the following:
- A global telecommunications company with operations in 20 countries
- A U.S.-based medical and research organization that started with 1,500 users and grew to 4,000 users
- A UK-based insurance company with a multivendor contact center and UC solution serving more than 10,000 users
- A U.S.-based provider of electronic design automation and semiconductor solutions with a solution covering 6,500 endpoints in more than 50 offices across the globe.
- A diversified technology company with operations in more than 150 countries, which requires dedicated on-site support for their multivendor UC and CC environment.
Based on interviews with executives at the five companies, Forrester used a composite representative company model to define the benefits they saw from a private cloud solution. Their results showed a total ROI of 42 percent in capital expenses for data center and telephony costs, improved contact center productivity, and simplified transformation to new communications technology.
How? According to Forrester’s research, there are 12 benefits that the composite organization saw from a private cloud deployment. Of the 12 benefits, five were quantifiable and generated an estimated 42 percent ROI (based on an average savings over five years) of $6,493,000, or about $12,987 per employee (500 employees).
The five key measurable benefits:
- Handle customer interactions more efficiently by helping to ensure that the right resources are readily available to customers. Through an interwoven, interoperable unified contact center and workforce optimization solution, enterprise goals, contact center targets, and customer objectives can be aligned and linked together.
- Intelligent routing and resource selection features allow systems to be configured to determine if customers should be served by the least-busy agent, the first-available agent, or the agent with skills that best match the customer’s needs.
- Internet-based text chat sessions with contact center agents improved agent productivity, as do self-service online customer service.
- Reduced capital expenditures for telephone devices per user/per month fees moved unified communications and contact center expenditures from initial CAPEX to longer-term operations expenses.
- Infrastructure cost avoidance savings included server and data networking hardware, software, and maintenance; network monitoring tools; primary rate interface (PRI) and analog trunk lines; interactive voice response (IVR) software and maintenance, contact center databases and maintenance; and associated power and cooling. Also included were the IT manpower savings associated with no longer managing the legacy multivendor, multi-location infrastructure, and allowing IT staff to focus on more strategic business initiatives.
In addition, executives at the interviewed companies identified the following seven benefits to using private cloud that were not as easily measurable:
- Using the cloud and a set of enterprise communications services that are based on and aligned with the industry-adopted tools of the internationally recognized Information Technology Infrastructure Library (ITIL) elements, customers can start with a baseline level of service management and then add extra elements as needed.
- Increased utilization of legacy technology assets meant avoiding the need to purchase new assets.
- Rising customer satisfaction scores were made possible by a number of factors, and were a strong driver for implementation.
- Customer service representatives can work in the office or from home using the same agent desktop interface. With a home agent program, organizations can recruit the best agents from a larger external talent pool.
- Acceleration of business transformation and increased agility.
- Increased focus of resources on core business outcomes such as improving customers’ experience and employee productivity, rather than day-to-day operational tasks.
- Establishment of a global standardized support structure.