Reduction In Infrastructure Costs

Evidence and data. Implementing a flex solutions model helped interviewees’ organizations reduce their infrastructure costs by eliminating the need for large upfront capital investments, instead enabling monthly payments for products and services over the term of the flex solutions agreement based on subscription-based usage. This model allowed companies to align IT spending with usage, avoiding overprovisioning and underutilized resources. Additionally, transitioning from the prior virtualization platform to HPE Morpheus VM Essentials Software led to substantial software cost savings. Energy efficiency also played a key role, as newer infrastructure consumed less power and required less cooling, resulting in lower utility bills. Interviewees provided examples of this benefit to their organizations:

• Flex solutions model enabled pay-as-you-go scalability. The VP of IT operations at a financial services firm explained how paying for monthly consumption instead of a capex outlay benefited them: “If we were going to purchase, it was going to be well over $1 million as an up-front investment, while we’re currently paying just $25,000 a month. We get to keep that money in the bank.”
  The director of infrastructure and operations at the lottery cited how the model gave them the ability to burst capacity when they needed it to scale up compute and storage: “One of the main reasons we chose flex solutions over a traditional capital refresh was the consumption-based model. It gives us burst capacity when needed — for example, spinning up or testing a new game. We can quickly scale compute and storage without going through lengthy assessments, RFPs, and hardware procurement. With flex solutions, the capacity is already available, allowing us to expand seamlessly and respond faster to business needs.”
  The VP of IT operations at a financial services firm cited the ease of adding capacity through change orders: “The benefit of a subscription-based model is that we pay monthly for what we use, with some headroom for growth — unlike traditional IT where you buy five years of compute, RAM, and storage up front. As usage increases, we simply add more through a change order, making it a more flexible and cost-efficient approach.”
  The flex solutions’ subscription-based models improved cash flow due to more predictable costs. The chief financial advisor at the cloud services provider said, “You could see it in our cash flow results — it shifted from what I used to call ‘peaks and valleys’ to a much smoother, more predictable trajectory.”

• VM Essentials reduced costs for virtualization platforms. The interviewees’ organizations further reduced their total cost of ownership by transitioning from a legacy virtualization platform to HPE Morpheus VM Essentials (VME) Software. This shift led to lower licensing costs and eliminated uncertainties associated with previous providers, offering a more stable and cost-effective virtualization solution. The VP of IT operations at the financial services company said: “We will not be renewing our contract with our current provider. We are currently transitioning to VME and will be fully on VME in one year. That will save us 70% per year in hypervisor costs.”

• New infrastructure lowered energy costs. Interviewees shared that the flex solutions’ newer infrastructure consumed less power and required less cooling compared to legacy systems. In addition to reducing utility bills, this also contributed to the organizations’ sustainability goals.
  The senior director of IT infrastructure and operations at the winery said: “Switching to flex solutions led to noticeable energy savings. By moving from 27 legacy blades to a 24-blade flex solution setup, we saw a reduction in electricity usage in our data centers. Then later, when we transitioned our storage to flex solutions, we achieved an additional energy savings. Our goal is to be net zero on energy by 2045, so this is helping us move toward meeting that goal.”
  The VP of IT operations at the financial services company said: “We’re seeing significant power savings because we’re no longer running equipment that sits idle. Instead, we only use what we need, which has greatly reduced overall power consumption — both for the servers and for air conditioning.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• Before moving to flex solutions, the composite organization spends $1.2 million in capex for infrastructure upgrades. This expense depreciates over five years at a cost of $240,000 per year.

• By implementing flex solutions, the composite organization avoids 80% of its planned capex in Year 1 and 100% of its planned expenditure in Years 2 and 3. Instead, it pays for compute and storage costs monthly based on usage under the flex solutions model.

• Prior to implementing VM Essentials, the composite organization spends $145,000 per year on its virtualization platform.

• The migration to VM Essentials occurs in Year 2, providing time for the composite organization to move off its prior license contract. The composite organization saves 50% of costs for its prior virtualization platform in Year 2 and 100% in Year 3.

• Before implementing flex solutions, the composite organization has monthly electricity costs of $5,000 for its data centers with older, less efficient infrastructure.

• After implementing flex solutions, electricity costs decrease by 25% due to the installation of new more energy efficient servers and storage arrays.

• Since the composite organization’s electricity costs would likely have decreased with the installation of any new servers and storage arrays, this benefit applies only to the first six months of Year 1 due to the faster infrastructure refresh enabled by the flex solutions contract versus the time required for a capex self-service refresh.

Risks. Forrester recognizes that these results may not be representative of all experiences. The following factors may impact this benefit:

• The scope and scale of an organization’s infrastructure refresh.

• The depreciation method and lifespan used for its capex outlay.

• Whether or not the organization chooses to change its legacy virtualization software.

• The amount of electricity consumed by the data center.

Results. To account for these risks, Forrester adjusted this benefit downward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $692,000.

Operational Efficiencies

Evidence and data. Interviewees’ organizations experienced operational efficiencies after adopting flex solutions because it changed how their IT infrastructure was consumed, managed, and scaled. They offloaded infrastructure management to the HPE support team, which reduced the burden on internal IT teams from manual and time-consuming tasks associated with legacy systems (e.g., frequent troubleshooting, patch management, capacity planning, preventative maintenance).
In addition, software developers became more efficient due to faster compilation times, boosting productivity across development cycles. IT procurement teams also saved time and effort by avoiding lengthy procurement cycles. Instead of managing formal procurement requests, the interviewees’ organizations quickly scaled up infrastructure through simplified change orders, accelerating delivery and reducing administrative overhead. These changes freed up internal resources, reduced labor hours, and allowed teams to focus on strategic initiatives rather than routine tasks, lowering operational costs. Interviewees provided examples of this benefit to specific teams within their organizations:

• IT FTEs reclaimed time for more strategic work. With flex solutions, the organizations’ IT teams no longer needed to manage and maintain the associated hardware. The director of infrastructure and operations at the lottery said: “Flex solutions looks after the preventative maintenance. It has really freed up a lot of time and resources from our data center team to be able to focus on other more strategic business initiatives.”
  The HPE team took on capacity management, as cited by the VP of IT operations at a financial services firm: “Capacity management is no longer handled by our staff — it’s now managed by the HPE team. Previously, a staff member would spend time each month reviewing capacity trends and making recommendations. That time has now been freed up.”
  Patch management was another task interviewees’ organizations transferred to HPE, freeing up time and reducing the need to pay overtime for evening work. The VP of IT operations at a financial services firm said: “Patch management, especially firmware and infrastructure patches, is one of the biggest tasks our staff no longer needs to handle because it has been fully offloaded to HPE. Our patching was done during evening hours, requiring staff to work two to three evenings each month. This change has given them some of that time back, eliminating the need for overtime and allowing them to focus on more strategic work.”
  HPE also took on overall care and maintenance, reducing the burden on IT teams. The director of infrastructure and operations at the lottery said: “When I say it ‘looks like the cloud and smells like the cloud,’ I mean it feels like a cloud service — we no longer have to worry about the underlying hardware. Although the infrastructure sits in our data center, HPE handles the care and maintenance, giving us the convenience of cloud-like management without the overhead.”

• Developers experienced faster compilation times, boosting productivity. As a result of implementing flex solutions, software developers benefited from faster compilation times, which made them more efficient across development cycles. The VP of IT operations at the financial services company said: “Our developers are able to take on more work now. The servers are so fast that compile times are 15% to 20% faster. Because of this, our developers can fit more into each sprint. That means our go-to-market timeline is faster.”

• IT procurement personnel saved time by eliminating RFPs. Procurement, finance, and legal teams also saved time and effort by avoiding lengthy procurement cycles. With flex solutions agreements, these teams could quickly scale infrastructure through simplified change orders, reducing administrative overhead. The director of infrastructure and operations at the lottery said: “We used to dread infrastructure changes because of the paperwork and approvals. We’ve done over 60 change orders since we started with flex solutions. That’s 60 times our organization didn’t have to go through RFPs or legal reviews. That’s a massive time saver.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• There are three IT FTEs who support infrastructure.

• By implementing the flex solutions model, the composite organization reclaims 30% of its IT FTEs’ time for more strategic projects because it transfers some of its tasks to the HPE Services support team.

• There are 50 software developers who each spend 15% of their time compiling code.

• With the infrastructure refresh, the composite reduces compilation time by 20% due to the new, higher performing infrastructure. Since the developers’ compilation times would likely have decreased with the installation of any new servers, this benefit applies only to the first six months of Year 1. This is due to the faster infrastructure refresh enabled by the flex solutions contract versus the time required for a capex self-service refresh.

• There are two back-office personnel involved in IT procurement.

• With the flex solutions model of submitting change orders instead of going through an RFP process, the back-office team spends 35% less time on IT contracts.

Risks. Forrester recognizes that these results may not be representative of all experiences. The following factors may impact this benefit:

• The level of HPE support needed, as some organizations may choose a self-service approach that requires less support from HPE, whereas others may opt to give more tasks to HPE.

• The number of change orders an organization submits rather than going through a full RFP process, which will impact the savings the procurement team experiences.

Results. To account for these risks, Forrester adjusted this benefit downward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $436,000.

Incremental Profit Due To Faster Infrastructure Refresh Via The Flex Solutions Contract

Evidence and data. Interviewees’ organizations experienced faster time to market for new products and services due to the rapid deployment capabilities of flex solutions. A traditional capex approach involved the internal organization and management of an entire infrastructure refresh (e.g., sizing, procuring, integrating, and testing hardware and software), which could take months. With flex solutions, HPE validated these elements before delivery, reducing deployment time and complexity. This allowed interviewees’ organizations to bypass time-consuming steps and get up and running quickly.

• The director of infrastructure and operations at the lottery described how much faster they could roll out new games because they didn’t have to wait: “Before, we were always constrained by infrastructure. If we wanted to launch a new game or platform, we had to wait for hardware and go through a whole procurement process, get the hardware, install it, and configure it. That could take weeks or months. Now, we just submit a change order and it’s done. That’s been a game changer for our delivery timelines.”
  The director went on to say: “Speed is critical for us. We’re constantly rolling out new games and platforms. It’s allowed us to deliver games faster because we don’t have to wait for infrastructure. We’ve been able to align better with marketing and product teams because we’re no longer the bottleneck.”

• The VP of IT operations at the financial services company described the difference in deployment speed: “Before flex solutions, we were always waiting on infrastructure. Now, we can just deploy and go. That’s made a huge difference in how quickly we can roll out new services.”

• Additionally, the flexibility and scalability of the service allowed the financial services company to absorb new acquisitions faster. The VP of IT operations said: “The new hardware investment has significantly improved our ability to respond to business demands. Over time, it has enabled us to successfully acquire and integrate three companies, thanks to the flexibility and scalability provided by HPE. This infrastructure allowed us to quickly absorb new organizations into our environment — our most recent acquisition was completed in just three months, a pace much faster than before.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• The average monthly revenue of the composite organization is $12,500,000.

• After implementing flex solutions, revenue increases by 5% due to faster time to market.

• The operating margin of the composite organization is 12%.

• Since the deployment of flex solutions is six months faster on average than the time required for a capex self-service refresh, Forrester can apply this benefit to the first six months of Year 1.

Risks. Forrester recognizes that these results may not be representative of all experiences. The following factors may impact this benefit:

• The speed with which an organization deploys flex solutions versus the time it takes to deploy a capex self-service refresh.

• The scope and complexity of new products and services.

Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $368,000.

Savings From Reduced Downtime

Evidence and data. After implementing flex solutions, customers said they eliminated outages and downtime that previously occurred due to outdated infrastructure. This improved reliability removed the financial and operational strain caused by unexpected downtime.
The senior director of IT infrastructure and operations at the winery described the negative impact of outages and how they no longer occurred with flex solutions: “We used to have outages two to three times a year that would stop the bottling line or shut down the distribution warehouse. Even an hour-long outage had a huge impact because we run a just-in-time operation — producing thousands of bottles of wine every hour. Since moving to flex solutions five years ago, I can’t attribute a single outage to the infrastructure.”
The VP of IT operations at the financial services company mentioned the reduction in post-outage costs since moving to flex solutions. They said: “Before, every time we had an outage, even after it was resolved, we’d spend hours on cleanup and reporting. That included root cause analysis and preparing reports for the executive team.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• Before implementing flex solutions, the composite experiences three outages per year. The average duration of each outage is 1.5 hours.

• Since implementing flex solutions, the composite organization experiences zero outages, saving 4.5 hours of downtime per year.

• The outages impact the productivity of 900 employees at the composite organization. As a result of flex solutions preventing outages, the organization avoids lost labor costs of $162,000 per year.

• The composite organization also avoids other miscellaneous outage costs such as contractual fees for demurrage and recovery costs.

Risks. Forrester recognizes that these results may not be representative of all experiences. The following factors may impact this benefit:

• The frequency and duration of outages.

• The extent to which an outage impacts an organization’s operations.

Results. To account for these risks, Forrester adjusted this benefit downward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $442,000.

Unquantified Benefits

Interviewees mentioned the following additional benefits that their organizations experienced due to the accelerated pace of implementing the new infrastructure, but were not able to quantify:

• Improved performance leads to business success. The senior director of IT infrastructure and operations at the winery described how faster data processing delivered data to their sales team first thing in the morning, which allowed them to start their day fully informed. They said: “The biggest business impact came from improved data processing. Overnight data warehouse processing dropped from between 6 and 8 hours to between 2 and 3 hours, making sales data available by 6:00 a.m. Eastern time. For the first time, our East Coast sales team had access to fresh data at the start of their day — a major shift. Previously, they had to delay important meetings until later in the day because the data wasn’t available on time. With the improved processing speed, they could begin their mornings fully informed, allowing for more flexible scheduling and better decision-making. This change had a significant impact on their productivity. I must have heard from 50 different salespeople how much of an improvement this was.”
  Another interviewee noted that the improvements in performance positioned them to win new business. The director of corporate technology at a financial services firm said: “Speed gives us a competitive edge throughout the year. At least once a month, we find ourselves in situations where being faster helps us win business. For example, during the tax year-end in March and April, our savings team sees high activity as customers move funds between accounts. In November, retail demand spikes due to events like Black Friday, driving up loan and finance applications. Similarly, business finance opportunities arise year-round. Being able to respond quickly across different systems and departments allows us to stay ahead of the curve.”

• Improved compute power expands data analytics. The senior director of IT infrastructure and operations at the winery said the infrastructure refresh also allowed their organization to deliver more comprehensive data analytics because the improved compute power could handle larger datasets. They said: “Before flex solutions, our database development team was hesitant to expand the data warehouse or integrate additional datasets due to performance concerns. We were only pulling minimal subsets from other vendors besides our main system, despite paying a premium for that data. After seeing the performance improvements, we quickly launched a project to bring in the full datasets. This allowed us to fully leverage the value of the data and expose it to the business. Today, we’re delivering more comprehensive analytics without increasing reporting time.”

• Support from HPE adds value. Interviewees leveraged different levels of support from HPE, including engaging dedicated account managers. They described the support as proactive, professional, and highly reliable. The director of infrastructure and operations at the lottery said: “Support has been a major benefit — both presales and during refresh cycles. We’re now approaching the end of our five-year flex solutions term and working with HPE and partners to assess future needs. These collaborative discussions help us determine what to refresh, what can be extended, and what still meets our business requirements under the current support model. It’s been a valuable part of the relationship.”
  The senior director of IT infrastructure and operations at the winery said: “Since implementation, support has been excellent. For example, when a CPU failed, HPE alerted us before we noticed and dispatched a technician with a replacement. A similar experience occurred with a memory module. The reliability and proactive support led us to migrate our SANs to flex solutions in 2024. Now, our entire on-premises compute and storage environment runs on the solution.”

Flexibility

The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might subscribe to flex solutions and later realize additional uses and business opportunities, including:

• Expanded use cases from flex solutions breadth. Beyond infrastructure refreshes, interviewees said that they saw value in the potential for other offerings from flex solutions. The director of infrastructure and operations at the lottery said: “The number of products and services under the flex solutions umbrella continues to grow. When you look at the full portfolio, there’s a lot available. For example, we’re currently implementing a ransomware recovery solution, which is part of flex solutions. Depending on the product and scale, we can also subscribe to software through flex solutions. One offering we’re particularly interested in is HPE Morpheus VM Essentials Software for hypervisor. These are just a few examples of the wide range of services and solutions available through flex solutions.”

Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Total Economic Impact Approach).