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Executive Summary:

Companies with an existing investment in a Microsoft infrastructure can benefit by implementing Microsoft’s unified communications solutions. This article takes readers step-by-step through the process of building a business case for unified communications that includes calculating Return on Investment.


In day-to-day corporate life, it’s rare for all members of a team to be able to communicate face to face. And if you’re responsible for daily IT operations and for making sure your company’s technology facilitates reaching its business goals, you want to provide the tools to make communication seamless. You start with desk phones, move to desktops, laptops, and fax machines, provide email, IM, mobile phones, and VoIP, and add smart phones and PDAs. But does all this technology really solve the problems of corporate communications? How many times have you had a simple yet urgent question and gone on to spend a frustrating half-hour IMing, making phone calls, and sending email messages simply to reach the person who can give you the 30-second answer you need? If you could unify all your individual technologies into a truly integrated solution, communication would be easier and faster, deals would close, projects would meet their deadlines, and you’d go home on time a lot more often.

If your company has an existing investment in a Microsoft infrastructure, Microsoft’s unified communications (UC) technologies can solve your communication headaches. Three key products form the backbone of Microsoft UC: Microsoft Exchange 2007, Office Communications Server 2007, and Office Communicator 2007. When you deploy these technologies together, you can provide ad hoc voice and video conferencing, archiving and encrypting of IM traffic, and voice access to email, contacts, and calendars. Your company’s employees will have a single point of contact for all other employees, and transitioning between email, IM, and voice and video conferencing can all be done with ease. You can make communications easy again. You can be a hero! But you know that when you propose UC to your senior management team, they’ll say, “Show us the business case.” Business cases make sense, but it’s rare to find someone who is skilled at, or comfortable with, creating them. Here’s where this article can help you: I’ll show you how to create a business case for UC that will be both compelling and appealing to your senior managers, even if you don’t have a degree in accounting and find the very idea of formulating a business case terrifying. My goal isn’t to sell you on specific Microsoft UC solutions, but let me segue into the topic of making a business case for UC with a brief discussion of UC’s value.

Why UC?
Sage Research has found that an average of 43 minutes per day could be saved for every business employee whose voicemail, email, and faxes are routed into one inbox. And Gartner has predicted that over the next three years, 80 percent of American businesses will integrate voice and messaging communications into their core line of business (LOB) applications.

Existing UC solutions can be divided into two categories: hardware-centric and softwarecentric. Vendors such as Cisco and Nortel have traditionally provided a large portion of their solutions with the hardware-based approach (although there are software components to this approach). These solutions provide endto- end devices and can operate independently of core applications such as Exchange and AD, or they can integrate with core applications by way of software-based connections. Hardware- centric solutions traditionally guarantee the highest quality of service, but a substantial investment in hardware is necessary, in addition to the post-deployment maintenance and management costs of vendor-specific applications and devices.

The software-centric approach is exemplified by Microsoft UC solutions. Because these solutions solve UC problems by using software, the skill sets necessary to maintain and manage the UC environment typically already exist in most enterprise IT server and application teams. At the highest level, a Microsoft UC environment will leverage existing investments in AD; integrate with Exchange, SharePoint, Office, and third-party LOB applications; and work inside and outside physical offices.

Business Case Fundamentals
In its simplest form, a business case will generally be based on the following formula:

Investment < \[(Implementation Costs)
  + (Maintenance Costs)\]
  – \[(Increase in Revenue) +
  (Time Returned per Employee ×
  Full-time Employee Fully
  Burdened Hourly Rate ×
  Number of Affected Employees)\]
 
Time

This way of calculating ROI shows that the investment in the new solution, in this case UC, will affect the business positively over a period of time. The accepted time frame is typically 12 to 18 months, but there are no hard and fast rules about how long this period needs to be. As you can see, all of the costs in the formula are quantifiable and can be documented and substantiated. As long as the amount on the left is smaller than the amount on the right, approval is a sure thing.

The problem with this approach is that the formula doesn’t account for strategic items that aren’t easily plugged into it. For example, what if your employees could prevent everyone but their manager from ringing their desk phone? What if everyone in your company could be reached via a single phone number? What if your remote teams could see each other on video during weekly conference calls and those calls were available via a video recording to anyone who couldn’t attend? Such UC solutions would offer significant benefits for your organization, including increased individual and team productivity, a heightened spirit of collaboration, improved relationships, and enhanced security. But the impact of these benefits is difficult to represent in the formula above. Therefore, the key to building a successful business case for UC is capturing the strategic behaviors that most affect your business.

The best way to do this is to schedule information- gathering meetings with key people in all areas of the business. These will include the CEO, CFO, CTO, business owners, project managers, and accounting, delivery, sales, Help desk, and other employees. (My typical practice is to schedule individual interviews followed by meetings with small groups.) I open these meetings by saying, “Thank you for taking a few minutes to talk with me today. We are currently considering ways to improve how we communicate with each other and our customers. We are doing this by gathering feedback from all areas of our business and consolidating them into high-level requests. Could you tell me about your experiences using our communications systems? How and how often do you use voicemail, email, faxing, and videoconferencing in your daily tasks? Have you come across any challenges?”

Nine times out of ten, you’ll be provided with more information than you could possibly explore in a half-hour. The great thing about this approach is that you’ll be recording the pain points that are specific to your company—not “companies of our size” or “typical industry experiences.” When you feel that the meeting participants have said all they can, you have the opportunity to build supporters for your UC case. Think about how the pain they’re experiencing today could be solved with your proposed solution. (The sidebar, “So Tell Me, Where Does It Hurt?” lists some problems specific to designated areas of a typical company.) You might say something like, “So, Fred, you said that one of the challenges you have today as sales manager is your team’s inability to get accurate inventory information when they’re on a sales call because they can’t contact the right people at the warehouse, and thus can’t close the deal. How many more deals do you think you could close per month if you had access to the people you needed at the point you needed them?” You can continue this process to compile as much company-specific information and to recruit as many supporters as you’d like.

Fashioning Your Approach
Your approach to adopting UC should be to start with a single department and a limited deployment of the solution. Think about how you can start down the UC track with minimal costs and maximum exposure. In my experience, adopting UC is very much like what happened with business laptops. Companies started out by deploying laptops for only a few individuals. As the benefits of enhanced employee autonomy and increased economic advantage became apparent, more and more laptops were deployed, until the business laptop became the ubiquitous tool it is today. I like to call this “the smoldering effect”: An innovation once introduced into an organization will smolder for a period before it bursts into flame.

After you’ve collected information in your interviews, identify the top one or two business problems that deploying a UC solution will solve. Concentrate on the pain points that have high senior-management impact and visibility. This means you need to stay away from the feature-and-functionality play. Instead, concentrate on specific solutions. Here’s how you might present a solution to the problem that Fred the sales manager brought to light: “After speaking with the sales team, we’ve determined that, by deploying a pilot of Office Communications Server, the enhanced communication and videoconferencing capabilities will help the sales team reach the right people in the warehouse at the right time. It will also let us include our remote limited presales engineers in customer meetings that they couldn’t attend before because the travel budget didn’t allow it. Fred estimates that with these improvements, his team can close an average of one more deal per month per salesperson. With an average deal size of $63,000 and five salespeople, we can see an increase in yearly revenue of $315,000 from a limited UC deployment in just this one department.”

This is the way you should think about how to introduce UC into your company. Start by getting approval for a limited deployment in a single department. You might even look into taking advantage of evaluation software to keep your upfront costs down. Keep the overall investment in hardware and software to a minimum by purchasing only the consulting, hardware, software, and licenses necessary for your limited initial deployment. For example, you might not need a fully redundant system if you’re augmenting and not replacing existing voice functionality. Just be sure to plan an architecture that can grow with your company as you extend UC’s reach to all areas of your business.

Compiling a Presentation Document
When you’ve gathered the data you need and have identified an area of limited deployment, it’s time to put everything together in a document presenting your business case. The following outline will guide you in compiling an effective document.

Start with an executive overview. This is a written summary of your solution and should be no more than four paragraphs long. It should follow this basic format:

  1. Describe the business problems your company is facing that you identified from the meetings you conducted with employees.
  2. Explain how you identified the problems by meeting with employees from throughout the business and listening to their problems and needs.
  3. Propose your solution to the problems. Back up your conclusions with data from third-party research organizations that detail the benefits of Microsoft UC solutions.
  4. Present the cost/benefit analysis of deploying your solution.

Explain UC. It’s important to use businessrelevant terms to explain UC in this section of the document. Don’t dive into the technical features of a UC solution, and stay away from using technical jargon. The senior-manager decision makers reading this document will want and need to understand how a UC solution can benefit the business. Knowing how the solution works won’t be an important consideration for them.

Detail the problem. Describe in detail the one or two strategic business issues you’re bringing forward and how your pilot UC solution will solve these problems. Be specific in describing the pain points you uncovered in your interviews concerning these problems.

Calculate costs and benefits. Use the simple ROI formula and the UC Calculation Spreadsheet, to calculate your solution’s estimated implementation and maintenance costs and the anticipated revenue increase and return on employee time. Combine these figures with the strategic information you gathered from your employee interviews to demonstrate a complete picture of the investment necessary to achieve your UC solution’s benefits and the anticipated payback period.

Go!
The words “business case” need no longer strike fear into your heart. If you follow the simple rules of listening to your employees, documenting pain points, demonstrating how a UC solution will solve specific problems, starting with a limited deployment, and using a simple formula to calculate ROI, you’ll be in the planning stage of a Microsoft UC pilot before you know it.

Keith Lynch