Business Value of UC

admin — Tue, 23 Mar 2010 23:03:58 GMT

Brenda Perea

Posted: Tuesday, June 16, 12:18 PM

Joined: 12/11/2007
Posts: 6

Samantha

Posted: Tuesday, June 16, 12:34 PM

Do you agree with some of these stats? Are we using BVI in our discussions?
Thanks Samantha

According to a T3i Group primary research study of nearly 300 business decision-makers, the percentage of enterprises (businesses with 500 or more employees) reporting bottom-line gains from UC is expected to jump significantly this year.

The study, entitled: InfoTrack for Unified Communications: The Business Value of UC, used survey results to develop a “Business Value Index” (BVI) to determine quantitatively which market segments were farther ahead in achieving business value from UC apps. Among enterprises, the percent beginning to achieve measurable business value is projected to jump from 14% in 2008 to 43% in 2009. Small and medium businesses (SMBs) are expecting a smaller increase, from 9% to 22%.

This research also compares the BVI of companies based on their preferred vendor of UC applications. The vendors whose users had the highest BVI were Microsoft, IBM and Cisco.

Marty Parker

Posted: Tuesday, June 16, 12:38 PM

Joined: 6/16/2009
Posts: 3

Hi, Samantha,

Impossible to know whether to agree or not, since there is no definition of BVI in the message.

I did some digging and find that my long-time analyst friend, Terry White, is the creator of the BVI metric. It seems to be a growing technique among analyst firms to define leaders and laggards then assign probabilities to their future actions. In the attached TOC of the study, it seems that companies with a higher BVI are more likely to increase their UC spending (or, restating the axiom: high ROI drives more investment…).

I have not talked with Terry about this yet, but Russell said that this was an assessment of the value obtained from UC investments. Perhaps Terry will share the methodology or algorithm and then it will be possible to say whether there’s agreement or not. If there is, then it may be worth supporting the concept to help customers that don’t like “ROI” to have another way to justify UC investments.

Anyway, there’s a response, for now.

Thanks, Samantha, for asking.

All the best

Michael Finneran

Posted: Thursday, July 9, 11:56 AM

Joined: 3/21/2008
Posts: 3

So can we get CXOs to invest in UC on this basis? IT seems the things that are selling this year are ones that can show a clear ROI like reductions in conferencing service costs, reduction in long distance fees and the like.

Should we be pitching productivity gains as the front line justification or the "icing on the cake"?

Jim Barker

Posted: Thursday, July 23, 2:30 AM

Joined: 5/25/2009
Posts: 1

We have seen more success in positioning UC and gaining acceptance from our business clients using the ROI model than anything else. We do, however, service a smaller business - usually one with 25 to 500 employees. You can see more about what worked for us at www.unified360.com/blogs.

Pam Avila

Posted: Monday, August 3, 9:43 AM

Joined: 7/16/2008
Posts: 17

OK - pretend that I'm a customer. Really, how can I get the financial benefits of UC that I was trying to achieve when we deployed it?

Rick Chin

Posted: Monday, August 3, 9:48 AM

Joined: 4/20/2009
Posts: 5

Everyone wants to receive some financial benefit from deploying UC since you’re taking multiple activities and centralizing them into your communications system. Perhaps you gain a little more value by enabling smartphones to listen and forward voice mail, slightly increasing the time savings and lowering response times. However, after that, where are the financial benefits?

Could you justify an upgrade or migration based on those productivity gains? The benefits of UC are real, but quantifying the impact is a tough job. It means measuring aspects of work that we consider insignificant or somewhat intangible.

With today’s focus on quick results and impact on the bottom line, features that contribute more directly to the work process are more valuable, which brings us to what should become UC’s killer app: business process automation.

Think about this: every business could streamline work better. Most businesses can’t afford to implement the current crop of business process automation and management suites. They’re very expensive, hard to program, and difficult to change as business changes. They also require a bunch of extra systems and layers in your infrastructure and they only offer partial visibility into the business process. Lastly, they don’t integrate communications at all, so your UC investment is no better off.

Imagine instead if business process automation was part of your UC applications. It would be ubiquitous, integrated, easy to setup and personalize, connected to your voice and data infrastructure, and reasonable in price.

Let’s say you process documents (accounts payable, sales orders, insurance claims, medical records). We’ll divide those documents into two groups, easy and hard. Easy documents go through the processes without challenge (representing the fastest a document can be processed) and hard documents go through the processes needing additional clarification and supervisor review or approval. Naturally, these processes for hard documents require more time and resources to complete.

(These are example numbers that are based off similar workflows for actual companies)

What the process looks like before automation: 100 documents, 19 steps, 100 reviewed by hand, 40% (40) documents are escalated for review and sign-off by a supervisor. Time for the easy file: 5 minutes. Time for a difficult file: 13 minutes. Total work hours: 13. Average cost per document handled: $3.16

The same process after automation: 100 documents, 16 steps, 80 auto-approved, 20 require further review, 40% (5) documents are escalated for review and sign-off by a supervisor. Time for the easy file: 2.3 minutes. Time for a difficult file: 5.2 minutes. Total work hours: 5. Average cost per document handled: $1.18

Assuming we’re paying people a flat $40,000/year, here are the projected savings from automation:
Daily: $198
Weekly: $989
Yearly: $51,405

Over $50,000 in savings from lightly automating just one process. What if we automated ten, twenty, or a hundred? Maybe we could take the time and money we save and reallocate resources to new opportunities or reduce overhead. If we systematized our employee knowledge and best practices, we’d reduce our risk of losing a key employee.

So, to answer you question, by combining UC and business process automation, you gain these highly measurable financial benefits of UC that you were hoping to see.