Saturday, August 6th, 2011

Supercharge Your ROI with the Cloud

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Still on the fence about whether the cloud would fit your enterprise needs? If you’re Interested in trying out cloud services, but wondering how to make the business justification, Forrester Research recently published an excellent analysis that’s a must read. The paper compares typical expected Return-On-Investment for the three most popular cloud applications today – CRM, ERP and Collaboration.

By using their Total Economic Impact model, Forrester was able to account for every way a solution affects a business. Each application was evaluated using 4 factors:

  • Benefits: How will your company benefit from cloud applications?

Usually, benefits concern around faster deployment speeds, pay-as-you go models that are better aligned with utilization, reduced support requirements, on-going enhancements to the service along with frequent, automatic upgrades that don’t tax IT.

  • Costs: How will your company pay, both in hard costs and resources, for cloud applications?

These are normally subscription costs, as well as softer costs of managing SLAs with vendors, and administrative overhead for orchestrating multiple cloud vendors.

  • Risks: How do uncertainties change the total impact of cloud applications on your business?

The biggest risks identified by Forrester are vendor viability in an emerging market and vendor lock-in, two major factors in launching new enterprise software projects.

  • Flexibility: How does this investment create future options for your organization?

Forrester advises readers to consider the agility and flexibility typically provided to IT by moving to the cloud.

Forrester found that of the three use cases, moving from on-premise to online provided the highest ROI over five years, with an ROI and payback of 27% between 12 to 24 months. By contrast, CRM and ERP projects typically realize a 20% and 6% ROI, respectively – and both have longer payback periods. If you’d like to get your hands on the full report–and increase your ROI–download your copy here.