1e’s sample software asset management model for 50,000 users
DESCRIPTION
1E AppClarity produces extensive reporting around software usage. For ROI analysis, 1E’s Business Analyst usually obtain a copy of prospect’s usage data. Feeding the data into AppClarity, we produce exact accounts of software usage categorized by unused and rarely used status by software package. In the absence of actual usage data, 1E approached the ROI analysis using out standard business value model seeded with software usage data obtained from our benchmark database. 1E Benchmark DB is a collation of actual software usage from 74 companies across 13 industries. The total seat count in our benchmark DB is more than 1.7M and it includes over 1700 software titles.TRANSCRIPT
Sample Software Reclaim Model for 50,000 Users White Paper
Return on Investment ................................................................................................................................................ 3
Sample RFI Response ................................................................................................................................................... 3
ROI Analysis Approach ................................................................................................................................................. 3
ROI Overview ............................................................................................................................................................... 3
ROI HIGHLIGHTS: ................................................................................................................................................. 3
ROI Three Year Cash Flow ............................................................................................................................................ 3
ROI – Three Year Cash Flow Chart: ..................................................................................................................... 4
ROI – Cumulated Cash Flows ....................................................................................................................................... 4
Three Year Cumulated Cash Flow Chart ............................................................................................................. 4
Software Usage Benchmark Summary......................................................................................................................... 5
Software Usage Benchmarks – Industry Spread ................................................................................................. 5
Top 10 Most Common Applications Used .......................................................................................................... 6
Software Usage Benchmark – Titles Selected for ROI ................................................................................................. 6
Software Usage Benchmarks – AppClarity Raw Data ......................................................................................... 6
Software License Savings – Monetization Methodology ............................................................................................. 7
Software License Savings Assumptions .............................................................................................................. 7
Software License Savings – Worksheet ............................................................................................................... 8
Software License Savings – Summary ................................................................................................................. 8
Sample Savings Calculation – (Photoshop) ......................................................................................................... 9
Additional Software License Savings ............................................................................................................................ 9
ROI Assumptions .......................................................................................................................................................... 9
NPV
Item Description Type Investment: YEAR 1 YEAR 2 YEAR 3 Total 4,112,901.26$
SPEND
1E License Cost Cap (2,250,000.00)$ -$ -$ -$ (2,250,000.00)$ NPV Discount Rate
1E Services Cap (200,000.00)$ -$ -$ -$ (200,000.00)$ 10%
1E Maintenance Exp (450,000.00)$ (450,000.00)$ (450,000.00)$ (1,350,000.00)$
SAVINGS IRR
License Savings Exp 3,700,887.86$ 3,935,794.12$ 1,964,700.90$ 9,601,382.88$ 113%
Server License Savings Exp -$ -$ -$ -$
Summary Exp -$ 3,250,887.86$ 3,485,794.12$ 1,514,700.90$ 8,251,382.88$ Payback (Months)
Cap (2,450,000.00)$ -$ -$ -$ 9.04
(2,450,000.00)$ (450,000.00)$ (450,000.00)$ (450,000.00)$ (3,800,000.00)$
3 Year Spend: (3,800,000.00)$ 3 Year Save: 9,601,382.88$
CASH FLOW ANALYSIS
Values
Perpetual
($2,450,000)
($3,800,000)
$9,601,383
113%
9.04
Savings Spend
$0 $2,450,000
Year 1 $3,700,888 $2,900,000
Year 2 $7,636,682 $3,350,000
Year 3 $9,601,383 $3,800,000
Cumulated Cash Flows
Payback Period (Months)
Pricing Model
Financial Metrics
Y1 Total Investment
Total Investment (3 Years)
Total Savings (3 Years)
Return on Investment (ROI)
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
Initial Year 1 Year 2 Year 3
Savings
Spend
Total Companies Benchmarked: 74
# Industries: 12
Total Seat Count: 1.8 M
Unused: 28%
Rarely Used: 5%
Used: 67%
Total Software Packages Benchmarked: 1,845
Total Data Points: 466 M
Unused: 42%
Rarely Used: 18%
Used: 40%
Overview of Benchmark Results
Analysis of a typical customer’s full database reveals there
is significant license waste across the whole environment.
Findings below include a sampling of 74 companies across
13 industries totaling 1.7 M seats shows 28% of all
software deployed is unused and 5% is rarely used.
Summary by Company
Summary by Software Title
Unused: Rarely Used: Used:
Benchmark Summary by Company
Unused: Rarely Used: Used:
Benchmark Summary by Software Title
Industry # Companies Sum of Size
Communications 4 99700
Engineering 5 47200
Finance 9 625500
Healthcare 8 222000
Manufacturing 10 202300
Retail 5 88500
Services 6 72700
Education 3 15600
Federal 1 15000
Technology 4 112000
Energy 10 75300
Insurance 7 147000
Pharmaceutical 2 30000
Grand Total 74 1,752,800
Product
Average of
Deployed %
Average of
Unused %
Avg. Rarely
Used %
Avg. Seat
Count
Count of
Customer
Sum of Seat
Count
Acrobat Professional 12% 24% 10% 22763 64 1456800
Visio Professional 6% 25% 24% 23844 61 1454500
Visual Studio Professional 2% 48% 18% 24624 58 1428200
Visio Standard 10% 25% 25% 23745 60 1424700
Project Standard 10% 37% 18% 24870 57 1417600
Project Professional 6% 27% 25% 22444 63 1414000
Photoshop 2% 29% 14% 21698 63 1367000
Crystal Reports 4% 54% 11% 27208 50 1360400
Illustrator 2% 33% 16% 22132 59 1305800
InDesign 1% 39% 16% 23691 54 1279300
Product
Avg. %
Deployed
Avg. %
Unused
Avg. %
Rarely Used
Avg. Seat
Count
#
Customers
Project Standard 9.55% 37% 18% 24870 57
SQL Optimizer for Oracle 1.48% 71% 8% 31707 29
Project Professional 5.91% 27% 25% 22444 63
Acrobat Professional 11.70% 24% 10% 22763 64
Business Objects Enterprise 1.53% 52% 14% 36705 20
Visio Standard 10.07% 25% 25% 23745 60
Visio Professional 5.58% 25% 24% 23844 61
Minitab 2.00% 31% 15% 31494 32
Inventor 1.14% 36% 15% 39947 19
InDesign 1.18% 39% 16% 23691 54
QuickTest Professional 0.67% 35% 12% 39771 24
Crystal Reports 3.80% 54% 11% 27208 50
BusinessObjects 1.31% 40% 14% 55725 16
Toad for Oracle 1.46% 38% 10% 32346 37
Publisher 9.75% 39% 16% 36374 27
Visual Studio Professional 1.76% 48% 18% 24624 58
Photoshop 2.23% 29% 14% 21698 63
Toad Data Modeler 0.84% 65% 13% 32625 28
Product
Avg. %
Deployed
Avg. %
Unused
Avg. %
Rarely Used
Avg. Seat
Count
#
Customers
Illustrator 1.61% 33% 16% 22132 59
Acrobat Standard 14.40% 9% 10% 25610 48
AutoCAD LT 0.51% 40% 15% 30125 36
Creator DE 15.00% 65% 7% 32362 29
Visual Studio Ultimate 1.55% 32% 22% 32521 34
Toad for Data Analysts 0.78% 67% 9% 30286 28
pcAnywhere 4.96% 71% 7% 36476 25
Captivate 0.46% 48% 17% 38481 26
Exceed 0.97% 35% 13% 38971 24
SQL Compare 0.33% 57% 12% 45080 15
WinZip 28.92% 15% 11% 24818 45
Reflection X 0.76% 51% 9% 55642 12
Tableau 0.24% 38% 22% 38723 22
WebEx 20.26% 7% 13% 30079 34
DRAW Graphics Suite 0.50% 44% 15% 43879 19
Dreamweaver 0.87% 37% 17% 28783 40
Dragon NaturallySpeaking 0.74% 37% 9% 44760 20
# Products Included in ROI: 35 Late Vers ion % Reduction: 0%% Recla im - Unused: 75% % New Purchases Per Year: 10%
% Recla im - Rarely Used: 25% # Years Reserve: 2Annual Software Support Cost: 20% % Future Unused 25%
Software Usage Data - 74 Customer Sampling
Price Publisher Product Deployed Unused
Rarely
Used % Unused Product
Avg. %
Deployed
Avg. %
Unused
Avg. %
Rarely Used
Avg. Seat
Count
#
Customers
599.95$ Microsoft Project Standard 4775 1752 874 37% Project Standard 9.55% 37% 18% 24870 57
2,250.00$ Quest Software SQL Optimizer for Oracle 739 522 62 71% SQL Optimizer for Oracle 1.48% 71% 8% 31707 29
688.00$ Microsoft Project Professional 2954 795 727 27% Project Professional 5.91% 27% 25% 22444 63
288.00$ Adobe Acrobat Professional 5851 1382 571 24% Acrobat Professional 11.70% 24% 10% 22763 64
# Products Included in ROI: 35 Late Vers ion % Reduction: 0%% Recla im - Unused: 75% % New Purchases Per Year: 10%
% Recla im - Rarely Used: 25% # Years Reserve: 2Annual Software Support Cost: 20% % Future Unused 25%
Year 1 Year 2 Year 3
NET SAVINGS: 3,700,888$ 3,935,794$ 1,964,701$
Photoshop INCLUDED in ROI: Yes
Cost of License: $2,000 Total to be Removed: 286
Annual Support Charge: $400 Late Version Percentage Reduction: 0%
Unused: 327 Total for Reclaim: 286
Unused Percentage Removed: 75% Number Purchased/Yr: 112
Unused Removed: 245 Number of Years Reserve: 2.0
Rarely Used 162 Total Target # of Licenses to Reserve: 223
Rarely Used Percentage Removed: 25% Total Target Licenses for Reclaim: 223
Rarely Used Removed: 40.50 Licenses Immediately Terminated: 63
Year 1 Year 2 Year 3
Purchase Avoidance - #Licenses: 112 112 -
Purchase Avoidance - Savings: $223,000 $223,000 $0
Maintenance Avoidance on Additional Lic: $44,600 $89,200.00
Maintenance Avoidance on Terminated Lic.: $25,100 $25,100 $25,100
Future Unused: $16,350.00 $16,350.00
Net Save: $248,100 $309,050 $130,650
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