The Total Economic Impact™ Of Microsoft Power Pages

Cost Savings And Business Benefits Enabled By Power Pages

A Forrester Total Economic Impact Study Commissioned By Microsoft, June 2024

Rapid web application development is vital for all organizations. Regardless of size, organizations need to ensure that new pages and features are helping to convert customers as quickly as possible, while non-corporate entities have legal obligations to inform the public about access to resources or potential threats. However, as cross-functional collaboration becomes more important than ever, and skilled senior-level developers are in short supply, it can be difficult for organizations to grow quickly in a sustainable and affordable way.

Microsoft Power Pages, a part of the Microsoft Power Platform, provides organizations with low-code web application development capabilities, improved integrations between web applications and back-end services, and additional features when used in conjunction with other parts of the Power Platform, including Power Apps, Power Automate, and Copilot Studio.

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 Power Pages.1 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Power Pages on their organizations.

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Three-year Return on investment (ROI)

197%

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Three-year Net present value (NPV)

$5.5M

To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed five representatives with experience using Power Pages. For the purposes of this study, Forrester aggregated the interviewees’ experiences and combined the results into a single composite organization.

Interviewees said that prior to using Power Pages, their organizations were limited to outdated legacy web application development services. These services often required significant manual effort to maintain, and siloed management made both the actual labor of web application development and the processes surrounding it take significant time. This led to a reliance on external contractors, delayed web application projects, and significant expenses to maintain integrations and data connectors, maintain the prior platform, and pay licensing fees.

After the investment in Power Pages, the interviewees were able to replace expensive, senior-level contractors with business users and accelerate their web application development. Key results from the investment include productivity savings on web application development, cost savings on hiring contractors, reduced total cost of ownership, and accelerated rollout of web applications.

Key Findings

Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:

  • Reduced development time for new web applications by 25%. Microsoft Power Pages enables the composite organization to templatize their web application development, reuse work rather than having to perform the same tasks repeatedly, and ideate on feedback significantly faster. This equates to a 25% productivity boost for web developers, yielding a risk-adjusted, three-year present value (PV) of $3.2 million.
  • Cost savings from reallocating 10 developer contractors by empowering junior or citizen developers. The low-code capabilities of Power Pages enable the composite organization to empower business users and junior-level developers for project support, instead of only relying on a team of high-level web development contractors to perform these tasks. This enables the composite organization to use the high-level web developers for other higher-value work. Replacing this team of 10 contractors saves the composite organization a risk-adjusted, three-year total of $3.3 million.
  • Time savings of 20% on maintaining integrations and data connectors for existing web applications. Built-in integrations with Power Pages enable the composite organization to avoid dedicating significant time to manage the integrations and data connectors between their web applications and back-end services. This provides the integrations team with 20% time savings, yielding a three-year, risk-adjusted benefit of $383,000.
  • Avoided ongoing licensing and maintenance costs for prior software and platforms of $800,000 per year. The composite organization’s prior web application development solution requires $150,000 per year in licensing fees, two maintenance engineering FTEs, and two database administrator FTEs to maintain. Power Pages eliminates the need for this maintenance effort and expenditure. Over three years, this saves the composite organization a risk-adjusted total of $1.3 million.

Unquantified benefits. Benefits that provide value for the composite organization but are not quantified for this study include:

  • Improved security. The built-in security for web end users of Microsoft Power Pages can enable savings on other security services and aid with compliance requirements for organizations that are either 1) working with, or 2) are a part of government or non-corporate organizations and regulated industries.
  • Improved service for constituents and customers. The composite organization’s increased velocity of web application development allows them to better anticipate and meet customer needs, as well as more quickly respond to feedback and solve issues. For government or non-corporate organizations, this speed could translate to more convenience for constituent or citizen services.
  • Reduced cost of service for organizations. Faster, more responsive web application development and improved overall web capabilities allow organizations to move away from costly solutions (e.g., call centers) for handling potential issues. Instead, they can leverage self-service or online options.
  • Improved time-to-market. Increasing the speed of web application development can significantly reduce the amount of time to launch new web pages — and thus, potentially new revenue-generating services.

Costs. Three-year, risk-adjusted PV costs for the composite organization include:

  • Implementation and training costs. The composite organization requires a small team working for three months to implement Microsoft Power Pages. This implementation, along with an initial training of the entire team and annual trainings of new employees, costs the organization a risk-adjusted, three-year total of $573,000.
  • Ongoing licensing and maintenance costs. The composite organization has two junior maintenance FTEs managing updates and ongoing support for Power Pages. It pays $600,000 in licensing fees annually for 100,000 monthly authenticated end users for its web applications. Over three years, this costs the composite organization a risk-adjusted $2.2 million.

The representative interviews and financial analysis found that a composite organization experiences benefits of $8.2 million over three years versus costs of $2.7 million, adding up to a net present value (NPV) of $5.5 million and an ROI of 197%.

Productivity savings for web application development

25%

“Without Power Pages, we would have struggled to put up something with the same level of functionality with a different platform in the short period of time we had.”

Senior business analyst, international non-corporate organization

Key Statistics

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    Return on investment (ROI)

    197%
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    Benefits PV

    $8.2M
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    Net present value (NPV)

    $5.5M
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    Payback

    <6 months
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Benefits (Three-Year)

Reduced development time for new web applications Cost savings on contractor developer team Time savings on maintaining integrations and data connectors for existining web applications Avoided maintenance and licensing costs for prior software and platforms

TEI Framework And Methodology

From the information provided in the interviews, Forrester constructed a Total Economic Impact™ framework for those organizations considering an investment in Microsoft Power Pages.

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 Power Pages can have on an organization.

  1. Due Diligence

    Interviewed Microsoft stakeholders and Forrester analysts to gather data relative to Power Pages.

  2. Interviews

    Interviewed five representatives at organizations using Power Pages to obtain data about costs, benefits, and risks.

  3. Composite Organization

    Designed a composite organization based on characteristics of the interviewees’ organizations.

  4. Financial Model Framework

    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.

  5. Case Study

    Employed five 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 for additional information on the TEI methodology.

Disclosures

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 Power Pages. For the interactive functionality using Configure Data/Custom Data, the intent is for the questions to solicit inputs specific to a prospect's business. Forrester believes that this analysis is representative of what companies may achieve with Power Pages based on the inputs provided and any assumptions made. Forrester does not endorse Microsoft or its offerings. Although great care has been taken to ensure the accuracy and completeness of this model, Microsoft and Forrester Research are unable to accept any legal responsibility for any actions taken on the basis of the information contained herein. The interactive tool is provided ‘AS IS,’ and Forrester and Microsoft make no warranties of any kind.

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.

Consulting Team:

Sam Sexton

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