roi of the cloud_vfinal

© IT Convergence 2016. All rights reserved.

Oracle ERP Cloud

Let’s Talk Numbers!Time to discuss the real cost of moving to the Cloud


Presenters


Agenda

Summary

Intro

IT Convergence Overview

Functional ROI

Technical ROI

Questions & Comments


IT Convergence Overview


IT Convergence Infographic


Technology Implementation

Technology Advisory

Cloud Services


Introduction


So What Is the ROI of moving to the

Oracle Cloud?


Methodology


Methodology

All transactions were tested by our Vice

President of Solution Sales.

This ROI is primarily focused on core

Financials. Additional activities will be done

related to ROI for Projects, Purchasing and

HCM.

Where practical, he entered five (5)

transactions to determine an average entry

time for both approaches.

The costs for an on-premise environment were

leveraged from an actual manufacturing

customer looking at procuring hardware for an

R12 instance.


Functional ROI


Supplier Registration

Automated Approvals

Invoice Entry

Watchlists


Reporting

Trees

Social

Drilldown


Invoice Entry


Invoice Entry

Manual Entry

Automated

Invoice

Processing

Time Study (Seconds) 153 43

Number of

Invoices/Day 140 502

Working Days/Month

to Process Invoices 71.3 19.9

Costs/Month $22,814.81 $6,370.37

Assumptions

Working Time/Day 6 hours

Invoices Processed/Month 10,000

Internal Cost for Resource $40



Manual Entry

Supplier

Registration


Time Processing New

Suppliers/Month

(Days)

4.5 1.0

Annual Costs $17,422 $3,911

Assumptions


Number of Registrations/Month 400



Automated Approvals


Automated Approvals

Manual

Approval

Automated

Approval


Time Processing

Invoice Approvals/

Month (Days)

5.7 .3


Assumptions


Number of Invoices/Month 1000



Watchlists


Watchlists

Manual

Search Watchlist


Time Spent

Searching/Month

(Minutes) 388.5 14


Assumptions


Number of Searches/Day 2

Number of Employees 10



Social


Social

Manual

Search Watchlist


Time Spent

Searching/Annually 525 46

Annual Costs $700 $62.22

Assumptions


Number of Searches/Month 25

Number of Audit Searches 50



Reporting


Reporting

Running New

Financial

Report Change POV


Working Days Running

Reports/Mont 4.2 .9

Annual Costs $4,000 $844

Assumptions


Number of Reports Run/Month 1000



Trees


Trees

Manual

Search Watchlist


Time Spent to Update

Reports 20.25 .08

Costs $1,620 $6.24

Assumptions


Number of Reports to Update 60



Drilldown


Drilldown

Manual

Search Watchlist


Monthly Time for

Drilldowns (Days) 3.2 1.1


Assumptions


Number of Monthly Drilldowns 1000

Number of Employees 10



Functional ROI Summary

Functionality Estimated Annual ROI

Invoice Entry $197,133

Supplier Entry $13,511

Automated Approvals $20,800

Watchlists $29,960

Social $638

Reporting $3,155

Trees $1,614

Drilldown $16,711

Total $283,522


Technical ROI


Human Resources

Application Licensing

Technical Infrastructure


Technical Infrastructure Components

Facility

Servers

Storage Array

Tape Backups

UPS for Server/Storage

Disaster Recovery Equipment


Production & Non-Production

Description Quantity Cost (Ea) Total

Datacenter facilities (renting a cage in a AAA data center) 2 $12,000 $24,000

Dell M820 Intel Xeon Processor E5-4600 Product Family with 4 CPU x 8

Cores x 2 (HT)=64 vCPU, 256 GB RAM Production

3 $41,004 $123,012


Cores x 2 (HT)=64 vCPU, 256 GB RAM Non-Production

4 $41,004 $164,016

Dell Blade Chassis M1000e-Med Grade 1 $25,000 $25,000

Storage Array 1 $30,000 $30,000

Tape Backup Library/Tapes/Backup Software/Offsite Storage 1 $50,000 $50,000

UPS for Servers/Storage 1 $10,000 $10,000

Total $426,028


Disaster Recovery

Description Quantity Cost (Ea) Total

Datacenter facilities (renting a cage in a AAA data center) 1 $12,000 $24,000


Cores x 2 (HT)=64 vCPU, 256 GB RAM Disaster Recovery

3 $41,004 $123,012

Dell Blade Chassis M1000e-Med Grade 1 $25,000 $25,000

Storage Array 1 $30,000 $30,000

Tape Backup Library/Tapes/Backup Software/Offsite Storage 1 $50,000 $50,000

UPS for Servers/Storage 1 $10,000 $10,000

Total $262,012


Human Resources

Description Headcount Burdened Salary

Technical Manager 1 $196,355

Primary DBA 1 $156,200

Secondary DBA (Junior Level <4 years Experience) 1 $116,645

System Administration (Backup/Storage/OS/Compute) 1 $154,222

Total $623,422

All salaries based on Glassdoor submissions in the US, with a 40% burden for benefits & fringe.


License Costs-On-Premise

License Discount 40%

Users

License

List

Maintenance

List

License

Discount

Maintenance

Discount Total Year 1

Financials 50 $ 4,595 $ 1,011 $ 137,850 $ 30,327 $ 168,177

Procurement 25 $ 4,595 $ 1,011 $ 68,925 $ 15,164 $ 84,089

Database EE User 60 $ 950 $ 209 $ 34,200 $ 7,524 $ 41,724

Database EE Processor 4 $ 47,500 $ 10,450 $ 114,000 $ 25,080 $ 139,080

Internet App Server EE User 60 $ 700 $ 154 $ 25,200 $ 5,544 $ 30,744

Internet App Server EE Processor 4 $ 35,000 $ 7,700 $ 84,000 $ 18,480 $ 102,480

Internet Developer Suite 10 $ 5,800 $ 1,276 $ 34,800 $ 7,656 $ 42,456

$ 608,750


License Costs-Cloud


Users License Maintenance License Maintenance Total-Y1

Financials 50 $ 600 $ - $ 216,000 $ - $ 216,000

Procurement 25 $ 350 $ - $ 63,000 $ - $ 63,000

$ 279,000


License Costs Comparison


Y1 Y2 Y3 Y4 Y5 Total 5 Year

On-Premise $ 608,749.50 $ 109,775 $ 109,775 $ 109,775 $ 109,775 $ 1,047,848

Cloud $ 279,000.00 $ 279,000 $ 279,000 $ 279,000 $ 279,000 $ 1,395,000


5-Year Technical Comparison

Year 1 Year 2 Year 3 Year 4 Year 5 Total 5 Year

On-Premise License Costs $ 608,750 $ 109,775 $ 109,775 $ 109,775 $ 109,775 $ 1,047,850

Infrastructure $ 688,040 $ - $ - $ - $ - $ 688,040

Human Resources $ 623,422 $ 623,422 $ 623,422 $ 623,422 $ 623,422 $ 3,117,110

Upgrade $ - $ - $ - $ 200,888 $ - $ 200,888

Total $ 1,920,212 $ 733,197 $ 733,197 $ 934,085 $ 733,197 $ 5,053,888

Cloud Subscription $ 279,000 $ 279,000 $ 279,000 $ 279,000 $ 279,000 $ 1,395,000

Infrastructure $ - $ - $ - $ - $ - $ -

Human Resources $ - $ - $ - $ - $ - $ -

Upgrades $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 250,000

$ 329,000 $ 329,000 $ 329,000 $ 329,000 $ 329,000 $ 1,645,000


Summary

roi of the cloud_vfinal

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