Any new technology that is brought into an organization has to provide value. Return on Investment, ROI, is one way to measure the amount of value generated relative to the costs incurred.
ROI for video conferencing is obvious, a slam dunk, barely even worth examining, right ? Yes and no.
ROI requires calculating costs and benefits.
Costs to Implement Video Conferencing and Collaboration
* Network Upgrades — Relative to many organizations’ network infrastructure, video is a killer app. Which is to say, it is the app that kills the network because it needs so much bandwidth. The trend is in the right direction here, more bandwidth is becoming available at lower costs, but organizations need to determine and obtain the bandwidth they need to support the level of video interaction they want. Ever wonder why Cisco is such an evangelist for video?
* Endpoints — The places that people engage in video conferencing and collaboration, whether mobile devices, laptops, desktops or dedicated video conferencing equipment, need to have the bandwidth, processing power, camera and sound to provide a good experience. The value equation is moving rapidly in the right direction here as well. More power and better quality video, sound and processing are increasingly available at lower costs.
* Infrastructure (MCUs / Bridges / Gateways) — A software solution like VeaMea needs a simple Windows server to manage the security, services and communications flow. Other solutions have a variety of customized hardware, or servers to provide bridging among endpoints, conferencing with disparate systems, firewall traversal, media sharing, recording, etc. without the infrastructure, most solutions are dead in the water.
* Implementation — Someone has to install, configure and test all the endpoints and infrastructure. This can be a pretty significant piece of the total start-up cost. Finding a partner you trust, and structuring an agreement that gets you the support level you want are critical.
* Training — Once everything works, unless it is “self-evident” technology, someone needs to develop training materials, deliver training to the initial end users, and deliver follow-on training as new users join the organization.
* Maintenance — Care and feeding of a video collaboration system is another “ToDo” for IT. Some organizations are big enough to have a separate AV staff or communications staff that focuses on Voice, Video, or UC. Giving them another set of assets to manage often requires additional staff.
While this all sounds like a lot of additional cost, it typically pales in comparison to the potential benefits.
Benefits of Video Conferencing and Collaboration
* Reduce travel — While you probably can’t end travel entirely, a secure, reliable video conferencing system gives you the ability to “meet” without the using the rest of the day getting to and from the meeting.
* Improved Efficiency — Giving people the ability to work more and travel less, whether to branch offices, client sites, supplier sites, or even to the office, add significant chunks of productive time back into staff schedules.
* Improved Results — By being able to “pop-in” to China and France in the space of an hour, managers are able to keep in closer contact with peers, or suppliers. Virtual teams, if well managed, can keep projects from running off track, delivering better results, faster and at lower cost.
* Business Continuity — Having a remote collaboration infrastructure allows organizations to be more flexible and continue to be productive during personal or weather induced emergencies by using the remote meeting technology to keep lines of communication open when physical presence is impossible.
* Reduced Administration Costs for Processing Expenses — The burden on employees of collecting, categorizing and submitting receipts is an enormous, yet invisible cost. The resources needed to review, pay, audit and archive receipts and expense reimbursement vouchers varies directly with the amount of travel in an organization. Less travel, less travel admin.
* Reduced Real Estate Costs — Desktop collaboration systems provide an added benefit that you can reduce the amount of real estate that your organization uses. If more conferences are virtual, how many fewer conference rooms do you need ?
* Positive Externalities — Much as I hate to contradict Kermit the Frog, sometimes it’s easy being green. Video conferencing and collaboration provide a compelling case for a new way to do business that uses less, achieves more and helps organization’s achieve their sustainability goals.
Summing up the ROI Calculation
There are a bunch of studies of video conferencing ROI. All of them show huge ROI, even with the most expensive investments in conferencing and collaboration equipment. Lots of vendors have ROI calculators built into their websites. These are neat little tools, but as with any such analysis, the assumptions you make have a significant impact on how rosy the picture is.
Bruno Martin, a French Consultant, summed up the success of Video Conferencing as 20% quality of the VC tool, 30% having an ADEQUATE network, and 50% correct users appropriation.
My translation:
To make the ROI equation work, whatever technology you use, make sure you have the bandwidth and leadership to drive adoption throughout the organization. If it isn’t used, the ROI stinks.
What has your organization’s ROI been ? Call us to discuss ways to improve availability and adoption throughout your organization.
