Smart SaaS ROI Calculations - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Cloud // Software as a Service
News
5/13/2010
02:20 PM
Connect Directly
LinkedIn
Twitter
RSS
E-Mail
50%
50%

Smart SaaS ROI Calculations

Our survey results reveal what factors had the greatest likelihood of being incorporated into an ROI study.

In an April InformationWeek Analytics survey of 393 business technology pros, we asked which of nine factors had the greatest likelihood of being incorporated into an ROI study at their companies on the business value of cloud computing. If you think operating expenses are the top consideration, you think wrong: No. 1 is initial capital expenditures, No. 2 is ongoing capex. Operating expenses for the life of the project came in third.

That's not so surprising considering the cloud model matured at a time when CIOs were desperate to keep moving forward even as capital budget cuts forced us into maintenance mode. Your initial pitch for software as a service probably focused on the low, predictable monthly cost and savings on licensing and hardware. Now, however, some creeping expenses are getting tracked back to you. First, it was upgraded bandwidth, then the request for better monitoring tools, then the small revolution that started when you forgot to let the cloud CRM system know when customers are on credit hold. Those depreciation savings that used to accrue from owning systems? Not so much. Your ROI model is suddenly so shaky the CFO even stopped calling you "The Man."

It's a common problem. Too many SaaS ROI models are done on a two- or three-year cycle, despite the fact that most organizations end up using applications for five to seven years. In addition, you need to make sure your model includes all of the items we've listed in the story above: data integration, increased bandwidth, security staff budget, application monitoring upgrades, and the cost for improved redundancy.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
InformationWeek Is Getting an Upgrade!

Find out more about our plans to improve the look, functionality, and performance of the InformationWeek site in the coming months.

News
Remote Work Tops SF, NYC for Most High-Paying Job Openings
Jessica Davis, Senior Editor, Enterprise Apps,  7/20/2021
Slideshows
Blockchain Gets Real Across Industries
Lisa Morgan, Freelance Writer,  7/22/2021
Commentary
Seeking a Competitive Edge vs. Chasing Savings in the Cloud
Joao-Pierre S. Ruth, Senior Writer,  7/19/2021
White Papers
Register for InformationWeek Newsletters
Video
Current Issue
Monitoring Critical Cloud Workloads Report
In this report, our experts will discuss how to advance your ability to monitor critical workloads as they move about the various cloud platforms in your company.
Slideshows
Flash Poll