Building a business case for unified communications solutions

How simplicity dictates TCO throughout the solution life cycle

June 26, 2012

How simplicity dictates TCO throughout the solution life cycle

BY BENNIE LANGENHOVEN, MANAGING EXECUTIVE, TELLUMAT COMMUNICATION SOLUTIONS*

A recent white paper** by research firm Aberdeen Group revealed how IT buyers can use simplicity to benchmark the total cost of ownership (TCO) of complex unified communications (UC) solutions – thereby avoiding being sold on the hype of a sales pitch.

TCO – the most important issue

With the recent global financial crisis, TCO became one of the most important decision factors in major IT purchases.

Increasingly, companies started requiring business cases that demonstrate the bottom line impact of solutions. IT directors – formerly solely responsible for the buying decision – came to share it with the chief financial officer (CFO) and other business decision makers.

The fox and the hen house

But with this change a knowledge gap opened up in the enterprise. The IT director had little appreciation for the financial returns that technology was meant to generate, and the CFO couldn’t evaluate the technology’s claims of being able to generate them.

A new corporate animal was needed who could ‘synergise’ technological as well as financial considerations to assess a solution’s return on investment (ROI).

In the meantime, enterprises had to rely on vendors to provide cost justifications for their purchases – a situation akin to having the fox guard the hen house.

War on complexity

Aberdeen’s paper resolves this blind spot by identifying simplicity as the factor that affects TCO the most at every stage of the UC solution life cycle. Suddenly, corporates had a yardstick for benchmarking TCO in solutions.

The study cites numerous documented cases of companies reducing their cost considerably by aggressively attacking complexity. For example, Proctor & Gamble realised $3 billion in savings by simplifying operations, and Motorola saved $2.6 billion with its ‘war on complexity’.

Design features that save on upfront and ongoing costs

To be assured of simplicity in the UC adoption experience, customers must ask the following questions of vendors: How does the design of the solution lend itself to easy deployment? How does it expedite learning, and enable ease of use? And how is managing, supporting, upgrading and retiring the solution made simpler because of its design?

If your vendor can demonstrate a link between the design of the solution and a seamless experience throughout its life cycle, you can rest assured that your company will spend less on training and certification, integration, support contracts and overcoming obsolescence.

Aberdeen highlights the following design characteristics as successful in lowering TCO:

–          Pure IP-based design – UC solutions based purely on Internet Protocol communications technology are less complex than the cobbled-together systems of “IP-enabled” legacy technology vendors. They are less complex to integrate new technologies with, and less complicated to manage.

–          A distributed architecture with federated replication as the means to redundancy – if one switch fails, it can simply be replaced, and scaling is as easy as adding another switch.

–          Open architecture that integrates seamlessly with business applications and processes

–          A management setup that allows for management of users rather than devices, thus reducing the time, complexity and cost of systems administration.

Aberdeen examples

Abderdeen’s report fills a gaping void in corporate decision-making concerning major IT investments.

Insisting on simplicity throughout the life cycle of UC solutions allows IT directors and CFOs to operate together successfully to choose the best possible solution.

* Follow Bennie Langenhoven on Twitter: @blangenhoven. Tellumat is the South African distributor of ShoreTel systems.

** http://www.shoretel.com/resource_center/white_papers/TCO_Benchmarking_Study.html