March 2023
Enterprises increasingly need a comprehensive digital workplace strategy to address the future of work, increase engagement, drive productivity enhancements, and reduce costs.1 Organizations that used Windows 365 to securely stream personalized desktops across devices found that it enabled a variety of scenarios for the new world of hybrid work while simplifying IT administration, improving productivity for a variety of end users, and driving cost savings.
Windows 365 is a cloud-based software as a service (SaaS) that securely streams virtual machines, which Microsoft calls Cloud PCs, to end users with simplified IT administration. Cloud PCs enable users to access their personalized desktop, apps, settings, and content from the Microsoft cloud on any device. Windows 365 helps organizations to easily set up and scale Cloud PCs to fit business needs and securely support hybrid workforces; streamline virtual desktop management for IT; improve productivity for employees, contractors, and power users; and drive hardware savings.Microsoft commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realize by deploying Windows 365 Cloud PCs2 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Windows 365 on their organizations.
To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed four representatives with experience using Windows 365. For the purposes of this study, Forrester aggregated the interviewees’ experiences and combined the results into a single composite organization that is a global organization with revenue of $10 billion per year and a distributed workforce that includes contractors, power users, and employees joining through acquisition.
Prior to using Windows 365, interviewees noted how their organizations used laptop computers to enable their contractors, third-party resources, power users, and employees joining through acquisition to access their corporate networks, files, and applications. In addition to physical desktops, they also had tried virtual desktop infrastructure (VDI), which had limitations in meeting users’ needs and resulted in unpredictable consumption costs. These prior attempts yielded limited success, leaving them with productivity issues, IT burden, security concerns, and deployment challenges.
After the investment in Windows 365, the interviewees simplified desktop deployment when providing Cloud PCs to employees and third parties. Key results from the investment include reduced IT costs for desktop management during onboarding, maintenance, and offboarding; improved time to value and productivity for users, including contractors and power users; and hardware cost savings.
Consulting Team: Kara Luk, Marianne Friis, Chris Layton
Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:
The composite organization significantly reduces IT efforts during employee onboarding, device maintenance, and offboarding using Windows 365. As a result, the composite saves $1.1 million in IT labor costs over three years.
The composite organization provides power users, including graphic designers, developers, and data scientists, with Cloud PCs that are properly configured for their specialized workloads. The Cloud PCs help power users manage large files and workloads much faster than otherwise possible and can be quickly reconfigured as needs change, helping them to avoid downtime.
The composite organization enables employees joining through M&A to access corporate desktops, files, and applications three weeks sooner than possible with a physical device, as they avoid waiting for hardware to be procured and delivered. Over three years, the composite recaptures $719,100 in productivity that was lost in the prior environment.
Windows 365 users access self-healing capabilities to troubleshoot and fix issues, avoiding the need to submit IT tickets and incur downtime.
The composite organization allows contractors to access Cloud PCs on their own devices, reducing hardware costs. Through the BYOPC program supported by Windows 365, contractors are empowered to purchase the laptop of their choice or utilize existing hardware. Over three years, the avoided hardware and shipping expenses total $1.1 million for the composite organization.
Unquantified benefits Benefits that provide value for the composite organization but that are not quantified in this study include:
Windows 365 enables users to securely access corporate data and applications. It also allows the organization to remove employee access instantly when needed as files and data are not stored on local machines. The composite organization mitigates risk and leaks by centralizing data and access in the cloud instead of on devices.
Windows 365’s subscription- based pricing enables the composite to forecast spend based on number of users, rather than consumption, as is typically the case with VDI. Additionally, Windows 365 offers greater IT management simplicity compared to VDI.
The composite organization can support accessibility software for employees and ease of access for remote employees. This allows it to support a greater diversity of employees across functions.
The composite organization can quickly upgrade users to higher-performance computing configurations instead of needing to redeploy machines or build one-off virtual machines.
In the future, the composite organization will leverage thin clients as appropriate and depreciate assets longer over time with Windows 365, reducing TCO.
Costs. Three-year, risk-adjusted PV costs for the composite organization include:
Over three years, the composite organization incurs $3.6 million in Windows 365 subscription costs based on the number of monthly users.
Two IT resources dedicate a portion of their time to deployment and ongoing management. New Windows 365 users also receive 15 minutes of training. The IT labor and training cost are lower than that of VDI for the composite organization and total $219,000 over three years.
The representative interviews and financial analysis found that a composite organization experiences benefits of $5.37 million over three years versus costs of $3.85 million, adding up to a net present value (NPV) of $1.53 million and an ROI of 40%.
As of late 2022, 66% of enterprise leaders have adopted anywhere or hybrid work.3 Forrester’s research indicates that this trend will continue as leaders and employees see the benefits of flexible work models.
Throughout the first two years of the COVID-19 pandemic, end-user computing (EUC) technologies, including solutions like Windows 365, were the lifeline connecting employees to their organizations, enabling them to collaborate with colleagues, participate in corporate culture, and maintain strong relationships with customers. In 2023 and beyond, EUC technologies will continue to play a vital foundational role in enabling organizations to maintain productivity, reduce cybersecurity risks, and serve and retain customers.
Forrester’s research finds that organizations increasingly see EUC as not just a necessity but as the conduit to a strong digital employee experience and a strategic competitive differentiator in the battle for talent. EUC technologies are an important contributor to employee experience, allowing employees to work productively from anywhere without sacrificing enterprise manageability and security. As companies expand geographically and support various forms of anywhere and hybrid work, EUC is the foundation that enables secure access to task-critical information.4
The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment decision. Forrester took a multistep approach to evaluate the impact that Windows 365 can have on an organization.
Interviewed Microsoft stakeholders and Forrester analysts to gather data relative to Windows 365.
Interviewed four representatives at four organizations using Windows 365 to obtain data with respect to costs, benefits, and risks.
Designed a composite organization based on characteristics of the interviewees’ organizations.
Constructed a financial model representative of the interviews using the TEI methodology and risk-adjusted the financial model based on issues and concerns of the interviewees.
Employed four fundamental elements of TEI in modeling the investment impact: benefits, costs, flexibility, and risks. Given the increasing sophistication of ROI analyses related to IT investments, Forrester’s TEI methodology provides a complete picture of the total economic impact of purchase decisions. Please see Appendix A or additional information on the TEI methodology.
Readers should be aware of the following:
This study is commissioned by Microsoft and delivered by Forrester Consulting. It is not meant to be used as a competitive analysis.
Forrester makes no assumptions as to the potential ROI that other organizations will receive. Forrester strongly advises that readers use their own estimates within the framework provided in the study to determine the appropriateness of an investment in Windows 365.
Microsoft reviewed and provided feedback to Forrester, but Forrester maintains editorial control over the study and its findings and does not accept changes to the study that contradict Forrester’s findings or obscure the meaning of the study.
Microsoft provided the customer names for the interviews but did not participate in the interviews.
Role | Industry | Region | Employees | Revenue/Funding |
---|---|---|---|---|
Branch manager for ICT services | Government | Australia HQ, national operations | 14,000 | Annual funding: $50B AUD |
Enterprise architect for digital workplace | Manufacturing | Europe HQ, global operations | 43,000 | Annual revenue: €11B |
Vice president of infrastructure and security | Financial services | Canada HQ, global operations | 10,000 | Annual revenue: 3.4B CAD |
President | Media and entertainment | US HQ, US operations | 10 FTEs, 17 seasonal workers | Annual revenue: $2M to $3M |
Prior to the investment, interviewees provided physical devices to contractors, third-party resources, and employees joining through M&A. Interviewees noted that they had also tried VDI to enable remote desktop access from their devices but found the complexity prohibitive.
The interviewees explained how their organizations struggled with common challenges, including:
Interviewees shared that the time required to deploy devices impacted productivity.
The enterprise architect for digital workplace at a manufacturing organization noted that the logistical challenges associated with procuring and setting up devices prevented employees joining through acquisition from gaining access to corporate resources in a timely manner.
Similarly, the vice president of infrastructure and security at a financial services organization shared: “In the old world, when we were collaborating with a third party that signed on to do some work with us, it could be three weeks before they had access. This went through access request, account creation, machine provisioning, user logging in, and signing in.”
In the prior environments, IT staff spent a significant amount of time on machine procurement, deployment, and maintenance. Interviewees shared that VDI created additional complexity that would have been unsustainable to manage without additional IT resources. The president at a media and entertainment organization said: “VDI was a challenge that required constant maintenance. It was just a pain. We couldn’t have used [a VDI solution] without a full-time IT person on staff [to support it].”
Interviewees shared logistical challenges around sourcing and shipping devices to employees, contractors, and third-party resources. For example, a manufacturing organization had a workforce spread across 180 countries, which created issues with customs and vendors being unable to deliver hardware to employees in certain locations. Additionally, the risk team at a financial services organization mandated a cease in shipping hardware to overseas contractors due to cost, logistics, and security issues.
Interviewees shared security concerns around physical devices. Before investing in Windows 365, a manufacturing organization provided VPN licenses to enable third-party resources to access its corporate network. The organization’s enterprise architect for digital workplace viewed this as a risk, saying, “By giving those external people a VPN, they had the keys to the kingdom and could access anything they wanted internally.” The president at a media and entertainment company had concerns over contractors accessing sensitive data from their personal devices on which security policies could not be enforced.
In their prior environments, organizations lacked flexibility in supporting power user computing requirements. For example, the vice president of infrastructure and security noted situations in their prior environment in which devices were not effectively configured for developer workloads and had to be shipped back and redeployed, impacting productivity. The branch manager of ICT services at a government organization had challenges supporting power users with its VDI approach: “Power users was another complication for us. If I had somebody in that environment who was a very heavy user on a pooled environment, I had to build them a separate VM, a separate virtual machine or server, just to handle their use case, which is an expensive way to solve a relatively easy problem.”
The interviewees’ organizations searched for a solution that could:
Interviewees sought a solution that could streamline the process of deploying and managing virtual machines to reduce IT burden and improve time to productivity for new employees, contractors, and third parties. Interviewees stated that Windows 365 provided a simple way to deploy Cloud PCs to any device.
Interviewees’ organizations required an agile way to meet the computing needs of power users and their specialized workloads. Interviewees highlighted how Windows 365 enabled them to configure their Cloud PCs with the storage and processing options to meet specific user needs and quickly update configurations as their needs changed.
Windows 365 offered the interviewees’ organizations an approach that could secure organizational and customer data without sacrificing productivity. Through storing information in the cloud instead of on user devices, Windows 365 enabled the organizations to address prior security concerns associated with physical devices and BYOPC scenarios.
Interviewees’ organizations invested in Windows 365 to take advantage of the subscription-based pricing, which provided greater cost predictability than VDI’s consumption-based pricing. Further, Windows 365 offered greater IT simplicity in desktop deployment and management compared to the interviewees’ prior experiences with VDI. The president at the media and entertainment organization said: “From our perspective, it was the simplicity of it all. [Windows 365] was going to save me time and frustration I experienced with VDI.”
Based on the interviews, Forrester constructed a TEI framework, a composite company, and an ROI analysis that illustrates the areas financially affected. The composite organization is representative of the four interviewees, and it is used to present the aggregate financial analysis in the next section. The composite organization has the following characteristics:
The global organization has annual revenues of $10 billion and 10,000 total employees, growing by 5% every year. The organization employs an additional 2,000 contractors. Contractors have an average attrition rate of 25% and must be replaced each year.
The organization also has a group of 500 power users, including graphic designers, video production staff, developers, and data scientists — all with specialized workload needs. The number of power users grows by 5% per year. Power users have an average attrition rate of 20% and must be replaced each year.
The organization is undergoing rapid growth and makes one acquisition per year. The number of employees joining per acquisition grows by 5% each year, with 150, 158, and 166 new employees joining in Years 1, 2, and 3, respectively.
In its prior environment, the composite organization deployed laptop computers to contractors and new employees acquired via M&A activity. M&A employees experienced a delay in corporate access until a desktop computer arrived. Power users only had access to local computing resources.
With Windows 365, the organization launches a BYPOC program for contractors, providing them with Cloud PCs that can be accessed on their own device, avoiding the need to provide them with a laptop. Employees joining through acquisition receive a Cloud PC for two months before they are transitioned to a physical computer. Power users are provided Cloud PCs to support their workload needs.
Ref. | Benefit | Year 1 | Year 2 | Year 3 | Total | Present Value |
---|---|---|---|---|---|---|
Atr | IT cost savings for employee onboarding, device maintenance, and offboarding | $414,159 | $434,867 | $456,655 | $1,305,681 | $1,078,994 |
Btr | Improved productivity for power users | $841,500 | $883,575 | $927,333 | $2,652,408 | $2,191,946 |
Ctr | Accelerated M&A employee productivity | $275,400 | $290,088 | $304,776 | $870,264 | $719,089 |
Dtr | Improved contractor productivity through self-service | $97,200 | $102,060 | $107,163 | $306,423 | $253,224 |
Etr | Cost savings through BYOPC enablement | $433,500 | $455,175 | $478,295 | $1,366,970 | $1,129,619 |
Total benefits (risk-adjusted) | $2,061,759 | $2,165,765 | $2,274,222 | $6,501,746 | $5,372,872 |
Interviewees using Windows 365 found that it significantly reduced the IT effort required to provide, maintain, and retrieve PCs for employees, including contractors and third-party employees. Windows 365 simplified machine deployment by eliminating the need to procure and ship physical PCs in these situations and reducing deployment processes. Cloud PCs were also easier to maintain and retrieve from contractors. These efficiencies not only drove cost savings associated with device management for IT but also enabled third-party resources to be productive sooner.
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
The fully burdened hourly cost of an IT resource is $58, or $121,500 annually.
The organization onboards 600 contractors in Year 1. The number of contractors onboarded per year grows by 30% each year, with 630 and 662 contractors onboarded in Year 2 and Year 3, respectively.
In the prior environment, it took 4 hours of IT time to procure and deploy each new machine for a contractor. With Windows 365, this effort takes 30 minutes — an 88% reduction.
The composite has a total of 2,000 contractors in Year 1. The total grows by 5% each year, with 2,100 and 2,205 total contractors in Year 2 and Year 3, respectively.
In the prior environment, IT maintenance effort per machine is 2 hours. With Windows 365, IT maintenance time per Cloud PC is 15 minutes — an 88% reduction.
The composite has a 25% annual attrition rate for contractors, with 500, 525, and 551 offboarded in Years 1, 2, and 3, respectively.
Device recovery time in the prior environment is 4 hours. With Windows 365, Cloud PCs are recovered in 10 minutes — a 96% reduction.
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
To account for these risks, Forrester adjusted this benefit downward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $1.1 million.
Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | ||
---|---|---|---|---|---|---|---|
A1 | Fully burdened hourly cost of IT resource | TEI standard | $58 | $58 | $58 | ||
A2 | Number of contractors onboarded | Composite | 600 | 630 | 662 | ||
A3 | IT procurement and deployment effort in prior environment per machine (hours) | Interviews | 4.0 | 4.0 | 4.0 | ||
A4 | IT procurement and deployment effort with Windows 365 per machine (hours) | Interviews | 0.5 | 0.5 | 0.5 | ||
A5 | Subtotal: Avoided planning and deployment costs (rounded) | A1*A2*(A3-A4) | $121,800 | $127,890 | $134,386 | ||
A6 | Number of contractors | Composite | 2,000 | 2,100 | 2,205 | ||
A7 | IT maintenance effort in prior environment per machine (hours) | Interviews | 2.0 | 2.0 | 2.0 | ||
A8 | IT maintenance effort with Windows 365 per machine (hours) | Interviews | 0.25 | 0.25 | 0.25 | ||
A9 | Subtotal: Avoided maintenance costs (rounded) | A1*A6*(A7-A8) | $203,000 | $213,150 | $223,808 | ||
A10 | Number of contractors offboarded | Composite | 500 | 525 | 551 | ||
A11 | Device recovery time in prior environment (hours) | Interviews | 4.0 | 4.0 | 4.0 | ||
A12 | Device recovery time with Windows 365 (hours) | Interviews | 0.17 | 0.17 | 0.17 | ||
A13 | Subtotal: Avoided recovery costs (rounded) | A1*A10*(A11-A12) | $111,157 | $116,715 | $122,495 | ||
At | IT cost savings for employee onboarding, device maintenance, and offboarding | A5+A9+A13 | $435,957 | $457,755 | $480,689 | ||
Risk adjustment | ↓5% | ||||||
Atr | IT cost savings for contractor onboarding, device maintenance, and offboarding (risk-adjusted) | $414,159 | $434,867 | $456,655 | |||
Three-year total: $1,305,681 | Three-year present value: $1,078,994 | ||||||
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Windows 365 met the performance needs of power users with specialized workload requirements, such as developers and video editors, reducing productivity issues and downtime incurred in their prior environments.
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV of $2.2 million.
Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | ||
---|---|---|---|---|---|---|---|
B1 | Power users | Composite | 500 | 525 | 551 | ||
B2 | Avoided downtime per power user (hours) | Interviews | 48 | 48 | 48 | ||
B3 | Fully burdened hourly cost of power user | TEI standard | $55 | $55 | $55 | ||
B4 | Productivity recapture | TEI standard | 75% | 75% | 75% | ||
Bt | Improved productivity for power users | B1*B2*B3*B4 | $990,000 | $1,039,500 | $1,090,980 | ||
Risk adjustment | ↓15% | ||||||
Btr | Improved productivity for power users (risk-adjusted) | $841,500 | $883,575 | $927,333 | |||
Three-year total: $2,652,408 | Three-year present value: $2,191,946 | ||||||
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The manufacturing organization leveraged Windows 365 during its recent acquisitions to improve time to productivity for new employees. The enterprise architect for digital workplace at that organization noted how employees joining through acquisition experienced a lag of three weeks before they could gain access to corporate resources due to challenges in procuring and shipping hardware. With the move to Windows 365, the organization effectively recaptured lost productivity for newly acquired employees with the ability to deploy Cloud PCs within a few hours.
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV of $719,000.
Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |||
---|---|---|---|---|---|---|---|---|
C1 | New employees from acquisition | Composite | 150 | 158 | 166 | |||
C2 | Additional productive hours saved for new employees | Interviews | 120 | 120 | 120 | |||
C3 | Fully burdened hourly cost of a general business resource | TEI standard | $36 | $36 | $36 | |||
C4 | Productivity recapture | TEI standard | 50% | 50% | 50% | |||
Ct | Accelerated M&A employee productivity | C1*C2*C3*C4 | $324,000 | $341,280 | $358,560 | |||
Risk adjustment | ↓15% | |||||||
Ctr | Accelerated M&A employee productivity (risk- adjusted) | $275,400 | $290,088 | $304,776 | ||||
Three-year total: $870,264 | Three-year present value: $719,089 | |||||||
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Interviewees found that resolving issues with Windows 365 was significantly easier than it had been in their prior environments, leading to avoided downtime for users. In particular, self-service tools empowered users to troubleshoot issues and their reset their machines if necessary, helping them to avoid downtime and reducing the need to contact IT for support. The branch manager of ICT services for a government organization said: “Self-help means fewer calls to the service desk and level 2 teams to help troubleshoot or fix hung sessions or virtual desktops. Users restart them quickly themselves. They prefer this approach, and the user experience is much preferred.”
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
The number of contractors and their fully burdened cost.
The frequency and severity of downtime in the prior environment.
To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV of $253,000.
Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |||
---|---|---|---|---|---|---|---|---|
D1 | Avoided downtime per contractor per year (hours) | Interviews | 2 | 2 | 2 | |||
D2 | Number of contractors | Composite | 2,000 | 2,100 | 2,205 | |||
D3 | Fully burdened hourly cost of a contractor | TEI standard | $36 | $36 | $36 | |||
D4 | Productivity recapture | TEI standard | 75% | 75% | 75% | |||
Dt | Improved contractor productivity through self-service | D1*D2*D3*D4 | $108,000 | $113,400 | $119,070 | |||
Risk adjustment | ↓10% | |||||||
Dtr | Improved contractor productivity through self-service (risk-adjusted) | $97,200 | $102,060 | $107,163 | ||||
Three-year total: $306,423 | Three-year present value: $253,224 | |||||||
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Interviewees experienced cost savings with Windows 365 by providing Cloud PCs to contractors instead of physical devices.
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV of $1.1 million.
Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |||
---|---|---|---|---|---|---|---|---|
E1 | Avoided laptops for contractors | Composite | 600 | 630 | 662 | |||
E1 | Avoided laptops for contractors | Composite | 600 | 630 | 662 | |||
E2 | Cost of a standard laptop | Interviews | $1,500 | $1,500 | $1,500 | |||
E3 | BYOPC budget for contractors | Interviews | $750 | $750 | $750 | |||
E4 | Shipping cost per device | Interviews | $100 | $100 | $100 | |||
Et | Cost savings through BYOPC enablement | E1*(E2-E3+E4) | $510,000 | $535,500 | $562,700 | |||
Risk adjustment | ↓15% | |||||||
Etr | Cost savings through BYOPC enablement (risk- adjusted) | $433,500 | $455,175 | $478,295 | ||||
Three-year total: $1,366,970 | Three-year present value: $1,129,619 | |||||||
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Interviewees mentioned the following additional benefits that their organizations experienced but were not able to quantify:
Interviewees improved security controls and reduced the risk of data leaks with Windows 365 by centralizing data and user access within the cloud versus at the device level. The vice president of infrastructure and security at the financial services organization noted, “It’s really a clean separation between corporate and personal or corporate and third-party assets that delineates ‘This is us; this is you; they don’t talk to each other.’”
Interviewees could also utilize their security tools on employees’ Cloud PCs, enabling third-party employees to access data and applications on their personal or corporate devices while ensuring proper security controls. The president at the media and entertainment organization said, “We’re able to use all of our security tools because we’re targeting Windows 365 Cloud PCs with those tools, whereas before we couldn’t target personal devices with them.”
Interviewees noted that the subscription-based pricing of Windows 365 provided greater cost predictability compared to past experiences with the consumption-based pricing of VDI solutions. Additionally, interviewees found that Windows 365 was significantly less complex to manage than VDI options.
Describing cost predictability, the branch manager of ICT services at the government agency shared: “The cost control and predictability is awesome. I know what I’m going to spend based on my user accounts rather than trying to guess 100 grand a month here or there. No one likes to be a million dollars out when it comes in the budget year with no explanation. Cost control is a benefit because it’s a licensed product with dedicated resources.”
The president at a media and entertainment organization noted several IT efficiencies compared to VDI: “If someone was getting a virtual machine through VDI, it’s not just the act of provisioning that user that is laborious. It’s the ongoing maintenance of these images and these deployments. It’s a laborious process to keep all of that updated and current, and with Cloud PC, it’s not.”
Interviewees highlighted several ways in which Windows 365 provided a better user experience than their prior approaches.
The vice president of infrastructure and security at the financial services organization appreciated having the ability to access Cloud PCs on any device through a web browser. They said, “I think the flexibility of the platform to be accessible from really any web browser, anywhere, is a big win for business continuity and a big win for ease of access.”
A branch manager of ICT services at the government organization noted that before Windows 365, subcontractors had to use two laptops to accomplish their work. The organization created a more seamless user experience by enabling subcontractors to access their Cloud PCs through their host organization device.
The branch manager also shared how Windows 365 helped support the application requirements of employees with accessibility needs, which had previously been a challenge with VDI. They said: “The ability to use 100% of accessibility software and products because of dedicated resourcing in the way that the product works is the number one benefit. You can’t achieve that in the other pooled-resource platforms.”
Windows 365 provided interviewees with the ability to configure Cloud PCs with the CPU, RAM, and storage levels required for each user’s workload needs and update configurations as needs changed. Interviewees appreciated the flexibility and agility enabled by the configurability.
The enterprise architect for digital workplace at the manufacturing organization shared: “We use two different Cloud PC configurations: one with 2 vCPU and one with 4 vCPU. The four vCPU is for employees that need a lot of computing power, like accounting staff that live and eat Excel for breakfast. Others require less. I myself use the 2 vCPU, and I’m very happy with it.”
The vice president of infrastructure and security at the financial services organization said: “In the past, we have sent assets that were specced for what employees were working on, but we’d find out they need more computing power. We’d have to ship back the machine and then procure and image a new machine to fit their requirements. With Windows 365, it’s a button in the portal, and we can say, ‘Let’s upgrade these to a power profile.”’
The president at the media and entertainment organization shared that Windows 365 enabled remote workers to be productive from a variety of locations. They said: “One of the great things that employees like about working for us is we are remote. We do have people that don’t have a home that they’re at every day of the year and don’t have the best internet connections in the world. And so, for them, Windows 365 Cloud PC was the only way they were going to move these files around.”
The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement Windows 365 and later realize additional uses and business opportunities, including:
The enterprise architect for digital workplace at the manufacturing organization planned to use Windows 365 to enable employees to access resources held on the networks of its acquired entities. They explained: “The company we bought had such a bad infrastructure because they’ve been eating other companies themselves, and we were not going to connect to it. Instead, we are going to give employees access to a Cloud PC on the old network so they can still access whatever information they need there.”
Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Appendix A ).
Ref. | Costs | Initial | Year 1 | Year 2 | Year 3 | Total | Present Value |
---|---|---|---|---|---|---|---|
Ftr | Windows 365 subscription costs | $0 | $1,392,300 | $1,461,956 | $1,534,864 | $4,389,120 | $3,627,121 |
Gtr | Deployment, ongoing management, and training costs | $12,758 | $134,699 | $52,627 | $53,091 | $253,175 | $218,593 |
Total costs (risk-adjusted) | $12,758 | $1,526,999 | $1,514,583 | $1,587,955 | $4,642,295 | $3,845,714 | |
Windows 365 includes several offerings, with multiple Cloud PC configurations based on performance needs at varying price points. The interviewees’ organizations purchased Windows 365 as a separate license per user for a fixed monthly fee to access and use each Cloud PC.
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
Due to the limited number of risks identified, Forrester assigned a risk adjustment of 0% and did not adjust this cost upward, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $3.6 million.
Ref | Metric | Source | Initial | Year 1 | Year 2 | Year 3 | |
---|---|---|---|---|---|---|---|
F1 | Windows 365 subscription costs | Interviews | $1,392,300 | $1,461,956 | $1,534,864 | ||
Ft | Windows 365 subscription costs | F1 | $1,392,300 | $1,461,956 | $1,534,864 | ||
Risk adjustment | 0% | ||||||
Ftr | Windows 365 subscription costs (risk-adjusted) | $0 | $1,392,300 | $1,461,956 | $1,534,864 | ||
Three-year total: $4,389,120 | Three-year present value: $3,627,121 | ||||||
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The interviewees noted that the initial deployment process and ongoing management for Windows 365 required minimal IT effort. Additionally, new users required minimal training.
Based on the interviewees’ experiences, Forrester assumes the following for the composite organization:
Forrester recognizes that these results may not be representative of all experiences, and the benefit will vary depending on the following factors:
To account for these risks, Forrester adjusted this cost upward by 5%, yielding a three- year, risk-adjusted total PV of $219,000.
Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 | |
---|---|---|---|---|---|---|---|
G1 | Number of FTEs managing Windows 365 | Interviews | 1 | 2 | 2 | 2 | |
G2 | Percentage of time spent on planning and deployment | Interviews | 10% | 40% | 15% | 15% | |
G3 | Percentage of time spent on user support | Interviews | 2% | 2% | 2% | ||
G4 | Fully burdened annual cost of IT resource | TEI standard | $121,500 | $121,500 | $121,500 | $121,500 | |
G5 | Subtotal: Deployment and support costs | G1*(G2+G3)*G4 | $12,150 | $102,060 | $41,310 | $41,310 | |
G6 | Training time per new user (hours) | Interview | 0.25 | 0.25 | 0.25 | ||
G7 | Contractors receiving training | Composite | 2,000 | 630 | 662 | ||
G8 | Newly acquired employees receiving training | Composite | 150 | 158 | 166 | ||
G9 | Fully burdened hourly cost of a contractor or newly acquired employee (rounded) | TEI standard | $36 | $36 | $36 | ||
G10 | Power users receiving training | Composite | 500 | 125 | 131 | ||
G11 | Hourly burdened cost of power user (rounded) | TEI standard | $55 | $55 | $55 | ||
G12 | Subtotal: Training costs | G6*((G7+G8)*G9+ G10*G11) | $26,225 | $8,811 | $9,253 | ||
Gt | Deployment, ongoing management, and training costs | G5+G12 | $12,150 | $128,285 | $50,121 | $50,563 | |
Risk adjustment | ↑5% | ||||||
Gtr | Deployment, ongoing management, and training costs (risk-adjusted) | $12,758 | $134,699 | $52,627 | $53,091 | ||
Three-year total: $253,175 | Three-year present value: $218,593 | ||||||
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These risk-adjusted ROI, NPV, and payback period values are determined by applying risk-adjustment factors to the unadjusted results in each Benefit and Cost section.
Initial | Year 1 | Year 2 | Year 3 | Total | Present Value | |
---|---|---|---|---|---|---|
Total costs | ($12,758) | ($1,526,999) | ($1,514,583) | ($1,587,955) | ($4,642,295) | ($3,845,714) |
Total benefits | $0 | $2,061,759 | $2,165,765 | $2,274,222 | $6,501,746 | $5,372,872 |
Net benefits | ($12,758) | $534,760 | $651,182 | $686,266 | $1,859,451 | $1,527,158 |
ROI | 40% | |||||
Payback | <6 | |||||
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Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders.
Benefits represent the value delivered to the business by the product. The TEI methodology places equal weight on the measure of benefits and the measure of costs, allowing for a full examination of the effect of the technology on the entire organization.
Costs consider all expenses necessary to deliver the proposed value, or benefits, of the product. The cost category within TEI captures incremental costs over the existing environment for ongoing costs associated with the solution.
Flexibility represents the strategic value that can be obtained for some future additional investment building on top of the initial investment already made. Having the ability to capture that benefit has a PV that can be estimated.
Risks measure the uncertainty of benefit and cost estimates given: 1) the likelihood that estimates will meet original projections and 2) the likelihood that estimates will be tracked over time. TEI risk factors are based on “triangular distribution.”
The initial investment column contains costs incurred at “time 0” or at the beginning of Year 1 that are not discounted. All other cash flows are discounted using the discount rate at the end of the year. PV calculations are calculated for each total cost and benefit estimate. NPV calculations in the summary tables are the sum of the initial investment and the discounted cash flows in each year. Sums and present value calculations of the Total Benefits, Total Costs, and Cash Flow tables may not exactly add up, as some rounding may occur.
Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
---|---|---|---|---|---|---|
XX1 | Avoided laptops for contractors | Composite | 600 | 630 | 662 | |
XX2 | Cost of standard laptop | Interviews | $1,500 | $1,500 | $1,500 | |
XX3 | Shipping cost per device | Interviews | $100 | $100 | $100 | |
XXt | Cost savings through BYOPC enablement (no stipend) | XX1*(XX2+XX3) | $960,000 | $1,008,000 | $1,059,200 | |
Risk adjustment | ↓15% | |||||
XXtr | Cost savings through BYOPC enablement (No stipend) (risk-adjusted) | $816,000 | $856,000 | $900,320 | ||
Three-year total: $2,573,120 | Three-year present value: $2,126,341 | |||||
Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
---|---|---|---|---|---|---|
XX1 | Standard user cost per month | Interviews | $41 | $41 | $41 | |
XX2 | Premium user cost per month | Interviews | $66 | $66 | $66 | |
XX3 | Contractors using Windows 365 | Composite | 2,000 | 2,100 | 2,205 | |
XX4 | Subtotal: Annual Windows 365 licensing costs for contractors | 12*XX1*XX3 | $984,000 | $1,033,200 | $1,084,860 | |
XX5 | Employees acquired each yea | Composite | 150 | 158 | 166 | |
XX6 | Subtotal: Windows 365 licensing costs for acquired employees | 2*XX1*XX5 | $12,300 | $12,956 | $13,612 | |
XX7 | Power users | Composite | 500 | 525 | 551 | |
XX8 | Subtotal: Improved contractor productivity through self-service | 12*XX2*XX7 | $396,000 | $415,800 | $456,392 | |
XXt | Windows 365 subscription costs | XX4+XX6+XX8 | $0 | $1,392,300 | $1,461,956 | $1,534,864 |
Risk adjustment | 0% | |||||
XXtr | Windows 365 subscription costs (risk-adjusted) | $0 | $1,392,300 | $1,461,956 | $1,534,864 | |
Three-year total: $4,389,120 | Three-year present value: $3,627,121 |
1 Source: “Tackle Your Digital Workplace Challenges With Forrester’s Scenario Quick Start Cards,” Forrester Research, Inc., December 22, 2022
2 Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders.
3 Source: “Master The Messy Middle Of Hybrid,” Forrester Research, Inc., September 28, 2022
4 Source: “The Forrester Tech TideTM: End-User Computing, Q1 2023,” January 27, 2023
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