ROI and Economic Value of Data Virtualization
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The document outlines a webinar series discussing the ROI and economic value of data virtualization, featuring expert insights on cost savings, improved productivity, and additional revenue generation. It covers key components of ROI, including IT development and operational cost savings, and provides examples of successful implementations from various organizations. The Denodo ROI calculator is introduced as a tool for assessing potential savings and business value derived from data virtualization initiatives.
ROI and Economic Value of Data Virtualization
- 1. DATA VIRTUALIZATION PACKED LUNCH WEBINAR SERIES Sessions Covering Key Data Integration Challenges Solved with Data Virtualization
- 2. ROI and Economic Value of Data Virtualization Paul Moxon SVP Data Architectures & Chief Evangelist, Denodo
- 3. Agenda 1. Overview of ROI 2. Components of ROI 3. Denodo ROI Calculator 4. Summary 5. Q&A 6. Next Steps 3
- 4. Overview of ROI • ROI is a key part of building a business case for your project or initiative • Data Virtualization projects are no exception • Data Virtualization ROI can come from many sources: • IT development and operational cost savings • Accelerated projects and improved productivity through quicker access to better data • New/incremental revenues from new products or services enabled through Data Virtualization 4
- 5. Components of ROI • IT Savings • IT Development costs savings • IT Operations cost savings • Business value • Improved productivity • Additional revenues enabled • Denodo investment • Licenses • Training, Services, etc. 5
- 6. Components of ROI – IT Development Cost Savings • Quicker to deliver data to users with fewer developers • Savings vary by project type • Projected savings based on results reported by customers • Calculator uses conservative estimates • Can be adjusted – all organizations are different • For example, savings on ‘data services’ reported as up to 90% 6
- 7. Example IT Development Cost Savings (1) 7 Value Driver Metric Goal Actual Time to Develop Time to develop data service in days 50% 90% Time to Deploy Time to Deploy data service in days 50% 90% TTM Overall time it takes to make data service available for use 60% 90% Time to Engage Time it takes for business to engage with IT 75% 75% Performance Performance of data services 50% 60% Impact Analysis How fast can we perform impact analysis 50% 90% Enterprise Architectural Alignment Ease at which data from disparate sources can be integrated Security, data classification High
- 8. Example IT Development Cost Savings (2) 8 0 10 20 30 40 50 60 $- $1,000,000.00 $2,000,000.00 $3,000,000.00 $4,000,000.00 $5,000,000.00 $6,000,000.00 Bldg web services prior to Denodo Initial Denodo POC Current Denodo Rate Annual Cost # full time staff FTE: 49 6 Annual Costs: $4.8M $600K
- 9. Components of ROI – IT Operational Cost Savings • Less data replication, less storage • Fewer servers needed for databases (staging, data marts, etc.) • Fewer admin staff needed for Data Virtualization vs. traditional technologies • 1/3 of staff for Data Virtualization • Software license cost savings • Application licenses • ETL licenses, database licenses 9
- 10. Example IT Operations Cost Savings • U.S. Government agency saved $600,000 annually in application license costs • Many employees needed application user licenses just to run reports or get data from applications • Using Data Virtualization removed need for these licenses • Users access data or ran reports via Data Virtualization Platform • U.S. Healthcare company saved $150,000 annually on SaaS application licenses • User retrieved data and ran reports via Data Virtualization Platform • Cost savings for data marts can be up to $150,000 per year per data mart 10
- 11. Headcount Cost Savings are ‘Soft Savings’ • (Most) companies do not simply fire staff • Reassigned to more productive work • e.g. Government department had 4-5 data engineers working full time fixing broken file transfers used for sharing data between agencies – moved to other projects • Some organizations don’t allow headcount savings in ROI • Convert cost savings to incremental revenue from more productive work e.g. • Revenue contribution per hour for Engineer = $1,016 • Revenue contribution per hour for Comm Sales = $3,904 • Annual hourly ‘savings’ for Engineer = 2,500 x $1,016 = $2,540,888 • Annual hourly ‘savings’ for Sales = 5,000 x $3,904 = $19,519,231 • Total incremental revenue from productive work = $22,060,119 11
- 12. Business Value – Improved Productivity • What value will the business get from having data – more data, better data – delivered to business users more quickly? • How many users? (Typically a ramp up of use as more users are onboarded) • How will it affect their productivity? • How will this affect the overall business? • Business value is often most difficult to quantify • But…if you can’t specify a business value, why are you doing the project? 12
- 13. Example Improved Productivity • Jazztel uses Data Virtualization to deliver customer data from 37 operational and analytical systems to a call center agent desktop • Agent has all customer data available when talking to customer • Goal to solve customer problem or answer questions in a single call without transfers or call- back • Agents spend less time finding customer data as all available through single application • No ‘swivel chair’ integration using multiple different apps • Time per customer – Average Handle Time (AHT) – reduced by 10% • With 3,000 call center agents – represented a saving of 300 FTE = €10M per year Note: First Call Resolution Rate (FCR) increased to over 90% and reduced ‘back office’ tasks by 50%. Customer satisfaction increase to over 95%. 13
- 14. Business Value – Additional Revenues • What new or incremental revenue are enabled by the use of Data Virtualization? • What new products or services can be enabled by Data Virtualization? • How much quicker can you bring these to market? • i.e. generate revenues quicker • Note: This is a one-time benefit and is not recurring 14
- 15. Example Additional Revenues (1) • Major retailer in Mexico • Time delay in synch’ing eCommerce site sales for in-store pickup with store level inventory systems • Result was items out of stock when customer went to pick up purchase • Poor customer satisfaction, lost business and costly refund processing • Using Data Virtualization to provide real-time access to eCommerce data and inventory data removed time delay • Purchased items for in-store pick up were pulled from inventory and reserved for customer • Lost revenue ‘savings’ of $MM 15
- 16. Example Additional Revenues (2) • Leading pharmaceutical company • Using Data Virtualization to integrate real-time manufacturing data with historical yield data for real-time yield optimization analytics • Result was 1-3% improvement in batch yield in manufacturing process • Each percentage improvement in yield resulted in $10M of incremental revenues to company 16
- 17. Denodo Investment • Cost of annual Data Virtualization license subscription • Cost of implementation • Internal staff • External contractors • Cost of Platform training • Cost of ongoing admin staff to manage Denodo Platform 17
- 19. Denodo ROI Calculator (Cont’d) 19
- 20. Denodo ROI Calculator (Cont’d) 20
- 21. Denodo ROI Calculator • Excel spreadsheet – editable by user • Three input sheet + ‘variables’ sheet • Inputs cover three components of ROI • IT savings, business value, Denodo investment • Variables sheet controls ROI calculations • e.g. % savings for IT projects • Default values based on customer attainments, but can be changed by users 21
- 22. Denodo ROI Calculator Quick Tour
- 23. 1. ROI is a key part of building a business case for any project or initiative. 2. Data Virtualization value is delivered in a number of ways – IT cost savings and business value. 3. Denodo has good examples of savings and value achieved by existing customers – IT cost savings and real business benefits. 4. Denodo’s ROI Calculator can guide you through the process of determining cost savings and business value – we will be happy to help you with this… Key Takeaways
- 25. 25 Next Steps Access Denodo Platform in the Cloud! Take a Test Drive today! www.denodo.com/TestDrive G E T S TA R T E D TO DAY
- 26. Thank you! © Copyright Denodo Technologies. All rights reserved Unless otherwise specified, no part of this PDF file may be reproduced or utilized in any for or by any means, electronic or mechanical, including photocopying and microfilm, without prior the written authorization from Denodo Technologies.