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Total Economic Impact
Cost Savings And Business Benefits Enabled By Pega Customer Service
A FORRESTER TOTAL ECONOMIC IMPACT STUDY COMMISSIONED BY PEGA, dECEMBER 2025
Total Economic Impact
A FORRESTER TOTAL ECONOMIC IMPACT STUDY COMMISSIONED BY PEGA, dECEMBER 2025
Organizations today face mounting pressure to improve operational efficiency, deliver seamless customer experiences, and reduce costs, all while navigating changing regulatory processes. Pega Customer Service helps businesses address these needs by streamlining processes, automating workflows, and leveraging AI to drive better, faster interactions for customers and employees. By simplifying operations and strengthening service engagement, solutions like Pega can support organizations’ efforts to improve customer experience, employee productivity, and overall operational performance.
Pega Customer Service helps customer journeys, connects the front office and back office, and offers customer service representatives real-time AI and workflow automation tools on a single, unified platform. The platform leverages AI and low-code capabilities to streamline tasks, speed up resolutions, reduce errors, and improve customer satisfaction. With features like proactive case management, agentic AI, omnichannel support, self-service, and compliance and enterprise governance-ready tools, Pega can help improve service delivery, reduce costs, and scale operations, while also helping organizations maintain consistency and agility in the face of evolving customer demands.
Pega commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realize by deploying Pega Customer Service.1 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Pega Customer Service on their organizations.
To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed four decision-makers with experience using Pega Customer Service. For the purposes of this study, Forrester aggregated the experiences of the interviewees and combined the results into a single composite organization that has $2.5 billion in annual revenue from 10 million B2C consumers globally.
Decreased average handle time
Before implementing Pega Customer Service, interviewees shared how their organizations faced several common challenges stemming from fragmented workflows, manual processes, and inconsistent customer experiences. Disparate systems and homegrown tools resulted in operational inefficiencies, customer frustration, and poor employee experiences. These inefficiencies led to errors, such as inaccurate customer information, delays in response times, and lost sales opportunities. The interviewees’ organizations struggled with compliance risks, audit complexities, and customer retention issues due to their inability to deliver seamless, timely, and accurate customer service. The lack of integration between systems also resulted in higher operating costs and a reliance on additional staffing to manage the growing complexity of processes, which hindered scalability and business growth.
After implementing Pega Customer Service, the interviewees’ organizations gained a streamlined platform that improved workflows, customer experience, and employee productivity. Pega’s workflow automation and AI enabled faster, more accurate responses, boosting first-call resolution (FCR) rates, reducing average handle times (AHT), and increasing both customer and employee satisfaction. The single-pane-of-glass user interface eliminated the need for customer service representatives (CSRs) to navigate between multiple systems, cutting costs and simplifying operations. Interviewees noted their organizations reduced training and recruitment expenses through better retention and optimized onboarding and guidance. According to the interviewees, Pega’s built-in enterprise governance and compliance features enhanced audit readiness, mitigated risks, and supported scalability for growth. Overall, Pega Customer Service delivered measurable efficiency, cost savings, and operational improvements for the interviewees’ organizations.
Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:
Reduced telephony volumes. Pega Customer Service reduces telephony interaction volumes and AHT through self-service, automation, improved data quality, and a unified interface for CSRs. By enabling customer self-service, the composite organization decreases telephony volumes by up to 25% and improves FCR rates by 15%, leading to fewer repeat calls. Automation and AI-driven efficiencies further reduce AHT, freeing up CSR time and improving overall productivity. As a result, the composite recaptures productivity equivalent to $8.3 million in savings, driving both cost savings and improved customer experience.
Improvement in first call response rates
Increased profits due to improved customer acquisition and retention. By enhancing customer service workflows and integrating customer data, Pega helps the composite organization improve customer retention and acquisition rates while increasing cross-selling opportunities with the power of Pega Real-Time Interaction Management capabilities. The composite organization experiences improved customer satisfaction and trust, leading to fewer abandoned calls and lost sales. With increased customer engagement, the composite realizes a 50% improvement in customer conversion rates in Year 1, growing to 100% by Year 3. Overall, the composite sees $7.3 million in gains.
Reduced training and attrition costs. Pega’s unified platform simplifies workflows and eliminates the need for CSRs to toggle between multiple systems, reducing training time and minimizing employee frustration and burnout at the composite. The composite organization sees a 50% decrease in CSR attrition rates due to improved job satisfaction and streamlined processes. Training hours for new hires are reduced by 25%, and recruitment costs are lowered as turnover declines. Together, these improvements lower hiring and onboarding costs while boosting employee engagement and retention, delivering a risk-adjusted benefit of $3.2 million.
Improved operational productivity by up to 40%. Pega Customer Service streamlines processes across customer-facing and back-office operations, improving productivity for both customer service teams and developers at the composite. By reducing workflow complexity and consolidating steps, the composite organization achieves productivity gains for operational staff and IT teams. These efficiencies allow the composite to optimize resources, redeploy employees to higher-value tasks, and improve cross-departmental collaboration. These productivity improvements yield a risk-adjusted benefit of $539,000 for the composite organization.
Decreased technical infrastructure, licensing, and equipment costs. The composite organization saves costs by decommissioning legacy systems and consolidating processes within Pega’s unified platform, eliminating the need for separate customer service, CRM, workflow automation, and ticketing systems. By retiring redundant infrastructure and reducing licensing and equipment costs, the composite organization saves $2.3 million.
Improvement in customer conversions in Year 1
Unquantified benefits. Benefits that provide value for the composite organization but are not quantified for this study include:
Improved time to value for workflow development. Pega Customer Service enables faster workflow creation for the composite and deployment through reusable components and a low-code interface. The composite organization sees an 8x improvement in time to value compared to legacy systems, allowing it to quickly adapt to customer needs and optimize operations. This agility supports continuous improvement and competitiveness.
Improved audit and compliance protection. Pega’s built-in governance and compliance features, including audit trails and data masking, enhance security and regulatory adherence. The composite benefits from reduced compliance risks and faster audit responses, minimizing penalties and improving operational trust.
Improved customer satisfaction. With better data quality, workflows, and AI capabilities, the composite can deliver more accurate responses to customers, resulting in significant improvements in satisfaction levels. It sees a 20% improvement in customer satisfaction driven by quicker responses and a seamless omnichannel experience.
Costs. Three-year, risk-adjusted PV costs for the composite organization include:
Enterprise licensing costs of $2.8 million. The composite incurs enterprise licensing fees based on user count and features deployed. For the composite, Pega’s flexible pricing model provides access to robust capabilities for customer service and operational efficiency. The composite organization pays $3.2 million for its total investment in Pega Customer Service.
Planning, migration, and implementation costs of $1.9 million. The composite organization allocates resources for planning and implementing Pega Customer Service, including technical staff, operational experts, and professional services. The implementation process requires an upfront investment but ensures smooth transitions with minimal disruption for the composite.
Ongoing maintenance, workflow development, and training costs of $2.1 million. The composite organization invests in maintaining and improving Pega Customer Service post-implementation. This includes technical support, workflow optimization, and ongoing employee training, ensuring continuous improvements and effective adoption of the platform.
The financial analysis that is based on the interviews found that a composite organization experiences benefits of $21.6 million over three years versus costs of $6.8 million, adding up to a net present value (NPV) of $14.8 million and an ROI of 217%.
Return on investment (ROI)
Benefits PV
Net present value (NPV)
Payback
| Role | Industry | Region | Revenue |
|---|---|---|---|
| Chief information officer (CIO) | Healthcare | North America | $400 million to $500 million |
| Senior vice president of design | Telecommunications | EMEA | Over $10 billion |
| Director of digital services | Financial services | North America | $500 million to $1 billion |
| Vice president of IT | Healthcare | North America | $500 million to $1 billion |
Before investing in Pega Customer Service, the interviewees’ organizations utilized a combination of competitor CRM and customer service solutions with several third-party and homegrown tools designed to handle internal workflows, support, and sales functions.
Interviewees described how their companies faced several common challenges before engaging Pegasystems including fragmented workflows, manual processes that drove operational inefficiencies, and increased customer and employee frustration. Without a system that could tie data, channels, training/guidance, and work processes together cohesively, interviewees said their organizations lost opportunities with their customers in ways that led to lower customer retention and cross-sales impacting company revenue and profits.
Interviewees noted how their organizations struggled with common obstacles, including:
Inconsistent customer service. Lack of clarity in processes and data created an inconsistent experience for customers at the interviewees’ organizations and led to lost sales for existing and potential customers. The vice president of IT in healthcare described the experience of their company: “We lost a significant number of referrals because of delays in our queue. We had customers never respond and the main reason is they did not hear back from us promptly and went to the next provider. Business growth suffered due to the opportunity cost that we were not able to convert all referrals, and we were losing customers.”
Manual processes that led to errors and customer frustration. Without a single-pane-of-glass user experience, CSRs at the interviewees’ organizations had to search for the data they need within multiple systems, which led to the sharing of inaccurate information with customers. The CIO in healthcare said: “When you have patients that are struggling, every day matters, every minute counts. We were dealing with all this nonsense in the back end. There were cases where prior authorization was done incorrectly so patients would be paying out of pocket. It just doesn’t leave a good taste in the patient’s mouth and there was a loss of revenue because of mistakes.”
A lack of back-office integrations and automation. Interviewees described how their previous solutions utilized a number of disparate systems and homegrown solutions to meet business needs. CSRs and operational teams were forced to jump between numerous systems to find information, extending the time of response and frustrating both customers and employees alike. Also, various systems had different and conflicting data and information, resulting in a lack of visibility and a burden on the CSR to validate what data is right. The director of digital services in financial services discussed the experience for their organization: “Our CRM had very basic functionality. If a member called to change an address or something, it was handled in different places and that was a big challenge. Basically, employees had no clue what happened once they submitted the request.”
Increased need for operational support for internal and external audits. Interviewees whose organizations had complex financial services or healthcare processes described how their companies struggled with keeping up with audit requests. The vice president of IT in healthcare described how the inefficiencies their company saw drove higher operational costs for internal audit and operational support: “We would struggle to collect all the information that was needed by auditors. It was a nightmare where, for four to five weeks, we would be struggling to capture all the information. The information was there but it was in multiple systems and not perfect.”
Increased compliance risk impacting customer acquisition. Beyond audit readiness, the lack of a single source of truth for data created compliance concerns. Interviewees described how their organizations struggled with negative findings for HIPAA or other potential violations, which led to substantial follow-ups for teams or fines for their companies. The CIO in healthcare shared: “We caught employees sending noncompliant responses. If you don’t catch it, it’s a big risk to the business and you can get fined by the local government pretty heavily.”
The interviewees’ organizations searched for a solution that could:
Increase automation and utilization of AI capabilities. The interviewees’ organizations were looking to improve automation across processes while utilizing AI to improve the customer experience and drive operational efficiencies.
Provide a single-pane-of-glass experience. The vice president of IT in healthcare described how their company was looking for a holistic platform to manage their end-to-end customer service processes: “Our goal was to have a single view of data, reduce the total cost of ownership, and provide better customer care. We wanted to reduce manual tasks, accelerate our workflows, and ensure consistent execution across different teams through automation and a unified customer management platform.”
Deliver low-code configurability. The interviewees noted their organizations wanted to avoid extensive customization with their new solution. The vice president of IT in healthcare revealed: “We wanted something that has a low-code configurability for workflows. We didn’t want to have to customize [the platform].”
Decrease staffing and training costs. Interviewees wanted a platform that could help them decrease costs or organize staffing based on improved operational efficiencies, FCR rates, and decreased AHTs for CSRs. The CIO in healthcare shared, “We were hoping to reduce temporary staffing when we have high volumes while eliminating the errors that were happening with new people that were brought in as turnover happens.”
Improve customer experience. Interviewees discussed the desire to deliver better, consistent omnichannel experiences with streamlined processes combined with quicker and more accurate resolutions. The vice president of IT in healthcare shared, “We made the decision for the platform that aligned with our strategic priorities, would help us improve our patient experience, and support the scalability that we were looking for.”
After a request for proposal (RFP) and business case process evaluating multiple vendors, the interviewees’ organizations chose Pega Customer Service and began deployment.
Holistic capabilities within a single platform. Interviewees shared how Pega offered their companies the best option to meet their business needs within a single, unified platform for both employees and customers. The vice president of IT in healthcare discussed their company’s experience: “We use Pega Customer Service to strengthen engagement with families and referral partners. The platform centralizes case management for new patient intake, including capturing referral details, verifying insurance information, and scheduling initial assessments. It also supports a service desk function for caregivers and staff, enabling faster resolution of billing questions, therapy schedule changes, and care coordination needs.”
Workflow and process development. Interviewees discussed how Pega stood out through its ability to improve time to value for new processes, connecting users from cross-functional teams, and decreasing the total time of development. The senior vice president of design in telecommunications discussed how Pega’s capabilities helped their company to deliver new processes and improvements quicker: “What Pega is very strong with is building reusable items on different access levels. It gives us modules that allow you to create reusable items that can be used in other circumstances.”
Deeper customer relationships. With a unified view of the customer journey, interviewees felt that Pega helped their organizations improve interactions with customers and ultimately led to improved business and financial results. The director of digital services in financial services stated, “We’re using Pega to deepen customer relationships with every interaction that happens while also increase sales and service efficiency.”
Security and compliance. The interviewees from organizations in complex and highly regulated industries saw Pega Customer Service as providing industry-leading capabilities to meet audit, security, and compliance needs. The senior vice president of design in telecommunications stated, “Pega is our preferred choice because of their strengths in data security and privacy and in private clouds.”
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 interviewees’ organizations, and it is used to present the aggregate financial analysis in the next section. The composite organization has the following characteristics:
Description of composite. The global business-to-consumer composite organization has $2.5 billion in annual revenue supported through an omnichannel experience. The composite has 10 million customers globally with customer service processes supported by 500 CSRs; back-office employees representing management, shared service, and operational areas; and 10 technical engineers.
Deployment characteristics. The composite organization deploys Pega Customer Service over a four-month period following five months of planning and internal migration from legacy third-party and homegrown solutions. A 10-person internal team of technical engineers, software developers, and business SMEs support the initial launch. The composite organization gradually transitions additional processes over a three-year period and decommissions legacy infrastructure — namely their previous customer service provider — as it rolls out Pega’s capabilities.
$2.5 billion in annual revenue
10 million customers
500 customer service representatives
$500 average annual revenue per customer
Operating margin of 20%
10-minute average handle time
| Ref. | Benefit | Year 1 | Year 2 | Year 3 | Total | Present Value |
|---|---|---|---|---|---|---|
| Atr | Savings from reduction in telephony interaction time | $2,496,875 | $3,400,000 | $4,250,000 | $10,146,875 | $8,272,892 |
| Btr | Increased customer profit | $2,000,000 | $3,000,000 | $4,000,000 | $9,000,000 | $7,302,780 |
| Ctr | Decreased employee training and retention costs | $816,000 | $1,530,000 | $1,530,000 | $3,876,000 | $3,155,793 |
| Dtr | Improved operational productivity | $164,900 | $220,150 | $275,400 | $660,450 | $538,763 |
| Etr | Decreased technical infrastructure, licensing, and equipment costs | $630,000 | $945,000 | $1,260,000 | $2,835,000 | $2,300,376 |
| Total benefits (risk-adjusted) | $6,107,775 | $9,095,150 | $11,315,400 | $26,518,325 | $21,570,604 |
Evidence and data. Interviewees said their organizations wanted to replace their outdated telephony and customer service solutions. With the investment in Pega Customer Service, the interviewees’ companies were able to better connect with customers and improve their experience across communication channels, enabling users to address their needs through self-service and reduce the burden on CSRs. Improved data quality, increased automation, and a proactive single-pane-of-glass experience for employees led to quicker response times and more accurate information shared with customers, which improved FCR rates and lowered AHTs.
Interviewees described how Pega’s capabilities helped their companies better integrate and standardize end-to-end workflows and processes and improved the quality of service and accuracy of the information shared with customers. The senior vice president of design in telecommunications shared, “Pega helped our company streamline forms in order that CSRs make less mistakes and provide the right information.”
Interviewees discussed how the integrated experience between communication channels led to more self-service by customers with a corresponding reduction in CSR interactions. The vice president of IT in healthcare discussed how Pega helped reduce their call volumes: “Customers reach us through phone, e-mail, chat, and web forms. Now, they can log into the portal and they’re able to find the information by themselves. That saves a call for us and saves time for them by getting them the answer that they were looking for quicker.”
Decreased telephony volumes
By integrating data from previously disjointed processes spread across multiple legacy systems into Pega Customer Service, the interviewees’ companies increased FCR rates by 15%. The senior vice president in design stated, “The customer experience is much better because they don’t need to call us again. There’s a lot of less back and forth with Pega coming in.”
Through Pega’s automation, AI, and improved data quality, interviewees’ organizations decreased their AHTs and improved customer experiences. As more end-to-end workflow processes were integrated with Pega, these improvements increased over time. The CIO in healthcare shared: “The whole process has been really streamlined and a lot of that is handled by the AI agent. Now, people can focus on other areas. The calls that come in are resolved much quicker, so we’ve reduced the time spent per call by at least 50%.”
Interviewees shared that their companies reduced costs by redeploying employees or even lowering overall headcount. The senior vice president of design in telecommunications shared that their company decreased CSRs from 1,300 to 850 due to their investment in Pega Customer Service.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
The composite had a total of 5 million annual telephony interactions before investing in Pega Customer Service.
The composite sees a 15% decrease in telephony interactions in Year 1, which grows to 25% by Year 3 as more workflow processes are integrated with Pega.
The initial AHT of 10 minutes for calls with CSRs decreases by 10% in Year 1, 15% in Year 2, and 20% in Year 3.
The composite organization recaptures 50% of the productivity from agent time savings after implementing Pega Customer Service.
The fully burdened hourly rate for a customer service representative is $30.2
Risks. Forrester recognizes that these results may not be representative of all experiences, and this benefit will vary depending on:
The previous solutions deployed, which impacts the magnitude of the efficiencies gained by utilizing Pega Customer Service.
The number and length of telephony interactions utilized through Pega.
The number of CSRs and supporting back-end users utilizing Pega.
The industry and complexity of the processes integrated through the platform.
Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $8.3 million.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| A1 | Telephony interactions before Pega | Composite | 5,000,000 | 5,000,000 | 5,000,000 | |
| A2 | Decreased telephony volumes with Pega | Interviews | 15% | 20% | 25% | |
| A3 | Telephony interactions before Pega | A1*(1-A2) | 4,250,000 | 4,000,000 | 3,750,000 | |
| A4 | Average handle time before Pega (minutes) | Composite | 10.0 | 10.0 | 10.0 | |
| A5 | Decrease in average handle time | Interviews | 10% | 15% | 20% | |
| A6 | Average handle time after Pega (minutes) | A4*(1-A5) | 9.0 | 8.5 | 8.0 | |
| A7 | Total time spent on customer interaction before Pega (minutes) | A1*A4 | 50,000,000 | 50,000,000 | 50,000,000 | |
| A8 | Total time spent on customer interaction after Pega (minutes) | A3*A6 | 38,250,000 | 34,000,000 | 30,000,000 | |
| A9 | Total agent time savings (minutes) | A7-A8 | 11,750,000 | 16,000,000 | 20,000,000 | |
| A10 | Fully burdened hourly rate for a customer service representative | Research data | $30 | $30 | $30 | |
| A11 | Productivity recapture rate | TEI methodology | 50% | 50% | 50% | |
| At | Savings from reduction in telephony interaction time | (A9/60)*A10*A11 | $2,937,500 | $4,000,000 | $5,000,000 | |
| Risk adjustment | ↓15% | |||||
| Atr | Savings from reduction in telephony interaction time (risk-adjusted) | $2,496,875 | $3,400,000 | $4,250,000 | ||
| Three-year total: $10,146,875 | Three-year present value: $8,272,892 | |||||
Evidence and data. Interviewees shared how their customers dealt with long wait times coupled with limited or even incorrect information for their questions and needs because of the limitations of their organizations’ previous solutions. By transitioning to Pega and using its capabilities for integrated workflows, real-time decisioning, and a seamless experience for customers, interviewees’ companies cut down on lost sales from abandoned calls and long handle times. With more personalized and interconnected services, these organizations saw increased cross-selling opportunities leading to higher revenues and bottom-line profits.
The director of digital services in financial services discussed how Pega connected their processes better and improved customer experiences, which ultimately led to an 400% increase for account openings for their company: “Any member request is managed in Pega and integrated with our account-opening data. Sales are also managed in Pega, so when a member calls, it automatically pulls up the profile we integrated with the telephony system. If they mention the intent of the call, it pulls up the appropriate request for the employee, so they don’t need to search for it.”
Interviewees described how their CSRs increased new customer acquisitions and cut back on lost sales for existing customers due to improved data quality and improved visibility and customer experience. The vice president of IT in healthcare shared, “It has helped us with employee retention, patient retention, and our services have improved for better NPS and CSAT [customer satisfaction] scores.”
One interviewee shared that their company cut lost revenue rates by 10x from $1.5 million down to $150,000 per year based on decreases in CSR mistakes, improper customer support, or customer abandonment.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
The composite organization has 50,000 selling interactions with customers through their omnichannel customer service platform before investing in Pega Customer Service.
With the investment in Pega, the composite sees a 50% improvement for customer acquisition and increased retention in Year 1 with subsequent gains of 75% in Year 2 and 100% in Year 3.
On average, the composite’s customers transact $500 annually with an operating margin of 20%.
Risks. Forrester recognizes that these results may not be representative of all experiences, and this benefit will vary depending on:
The organization’s relative size, customer base, industry, and location of operations.
The organization’s prior solution and its capabilities.
The organization’s operating margin.
Results. To account for these risks, Forrester adjusted this benefit downward by 20%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $7.3 million.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| B1 | Customer enrichment and acquisition driven by customer service before Pega | Composite | 50,000 | 50,000 | 50,000 | |
| B2 | Increased customer conversion rate with Pega | Interviews | 50% | 75% | 100% | |
| B3 | Customer enrichment and acquisition driven by customer service after Pega | B1*(1+B2) | 75,000 | 87,500 | 100,000 | |
| B4 | Revenue per customer (annual) | Composite | $500 | $500 | $500 | |
| B5 | Increased customer revenue | (B3-B1)*B4 | $12,500,000 | $18,750,000 | $25,000,000 | |
| B6 | Operating margin | Composite | 20% | 20% | 20% | |
| Bt | Increased customer profit | B5*B6 | $2,500,000 | $3,750,000 | $5,000,000 | |
| Risk adjustment | ↓20% | |||||
| Btr | Increased customer profit (risk-adjusted) | $2,000,000 | $3,000,000 | $4,000,000 | ||
| Three-year total: $9,000,000 | Three-year present value: $7,302,780 | |||||
Evidence and data. Beyond the impact that Pega had on revenue and CSR operational costs, interviewees discussed the impact Pega had on employees and internal cost pressures. By eliminating the need to coordinate processes and data across several disparate systems, Pega gave employees at the interviewees’ organizations a unified user experience with real-time AI guidance and automated manual processes that were previously frustrating. With less complexity in understanding the platform, the interviewees’ companies cut down on ramp-up time for new employees while reducing overall turnover rates.
Interviewees reported that, with Pega’s unified interface and better data quality, employee experience improved, which led to a significant drop in turnover rates. The vice president in IT in healthcare stated: “The average length of employee tenure was six months to a year because of the pressure of the work before Pega. Now the organization is much more stable, and people are staying for a longer time.”
The director of digital services in financial services talked about how Pega helped improve employee engagement at their organization as they were able access data and customer information much easier and faster: “Pega comes back with a quick response within 5 to 6 seconds and, in the case of an employee wanting to know more, it always has a reference where they can find more information. The biggest pain points we used to hear is that the system was too complicated and all the simplification that we were doing with Pega paid off.”
With an improved user interface and end-to-end workflow integrations that connected complex interdepartment processes into a single platform, the interviewees’ organizations reduced the total training time for new employees. Interviewees said their companies reduced the upfront training time for their staff by an average of 25% after implementing Pega Customer Service.
Decrease in attrition rate for CSRs
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
The composite had an annual CSR attrition rate of 40% before implementing Pega Customer Service.
The CSR attrition rate of composite organization decreases by 25% in Year 1 with a 50% total drop-in attrition rate starting in Year 2.
Recruitment and hiring costs total $15,000 per employee.
The average CSR hire requires 80 hours of total training for onboarding activities. This time is decreased by 25% after the implementation of Pega Customer Service.
The fully burdened hourly rate for a customer service representative is $30.3
Risks. Forrester recognizes that these results may not be representative of all experiences, and this benefit will vary depending on:
The organization’s relative size and industry, as well as the complexity of its processes.
The length of time required to ramp and attain proficiency for CSR agents with legacy systems and processes.
CSR compensation and hiring costs.
Initial attrition rate, which may be higher or lower at organizations.
Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $3.2 million.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| C1 | Customer service representatives | Composite | 500 | 500 | 500 | |
| C2 | Customer service representative attrition before Pega | Composite | 40% | 40% | 40% | |
| C3 | Decrease in customer service representative attrition rate | Interviews | 25% | 50% | 50% | |
| C4 | Customer service representative attrition after Pega | C2*(1-C3) | 30% | 20% | 20% | |
| C5 | Recruitment and hiring cost per employee | Composite | $15,000 | $15,000 | $15,000 | |
| C6 | Decrease in customer service representatives hired | C1*(C2-C4) | 50 | 100 | 100 | |
| C7 | Subtotal: Total savings from lower hiring and recruitment costs | C5*C6 | $750,000 | $1,500,000 | $1,500,000 | |
| C8 | Training time per employee before Pega (hours) | Composite | 80 | 80 | 80 | |
| C9 | Decrease in training time for customer service representatives | Interviews | 25% | 25% | 25% | |
| C10 | Training time per employee after Pega (hours) | C8*(1-C9) | 60 | 60 | 60 | |
| C11 | Total training time before Pega (hours) | C1*C2*C8 | 16,000 | 16,000 | 16,000 | |
| C12 | Total training time after Pega (hours) | C1*C4*C10 | 9,000 | 6,000 | 6,000 | |
| C13 | Fully burdened hourly rate for a customer service representative | Research data | $30 | $30 | $30 | |
| C14 | Subtotal: Total savings in training costs | (C11-C12)*C13 | $210,000 | $300,000 | $300,000 | |
| Ct | Decreased employee training and retention costs | C7+C14 | $960,000 | $1,800,000 | $1,800,000 | |
| Risk adjustment | ↓15% | |||||
| Ctr | Decreased employee training and retention costs (risk-adjusted) | $816,000 | $1,530,000 | $1,530,000 | ||
| Three-year total: $3,876,000 | Three-year present value: $3,155,793 | |||||
Evidence and data. Interviewees said their organizations experienced overcomplicated processes that stretched across several systems, channels, and data sources. This led to long wait times for customers and operational inefficiencies for cross-functional teams within their organizations with previous solutions. By transitioning to Pega Customer Service, interviewees’ organizations streamlined and simplified both customer-facing and operational processes.
The director of digital services shared how their company streamlined processes based on Pega’s capabilities: “Previously, every process used close to 30 to 40 clicks. Now, we brought a lot of processes into Pega, and we made it a principle that any process in the system is less than seven clicks.”
Beyond customer-facing workflows, interviewees said their organizations utilized Pega’s capabilities to build out fully integrated processes and drive efficiencies to a variety of cross-functional teams including human resources, finance, marketing, internal audit, and more.
The senior vice president of design in telecommunications discussed how their company utilized Pega Customer Service: “One of the biggest levers is automated document creation because in [our department] a lot of time is spent with contracts, certificates, and letters. We automated that to the full end [with Pega].”
This interviewee continued with describing how they utilized Pega across several departments with plans to continue to expand to new work areas: “From an implementation time and usability perspective, it’s so impressive that we get acceptance from [different] users. Now, it’s spreading to adjacent business functions who are actively requesting Pega.”
Interviewees also discussed the benefits of Pega’s capabilities for their IT teams. The vice president of IT in healthcare explained: “The beauty of the Pega system is that it is a low-code, no-code platform and our team could rapidly configure or modify workflows. The work for the agents is much simpler now and there’s more agility. Business processes are more flexible, and IT is not doing the heavy lifting anymore.”
Overall, interviewees shared how their business and technical teams saw productivity gains between 20% and 40% based on their investment in Pega Customer Service.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
The composite utilizes 20% of the time of 50 back-office FTEs from shared service and operations teams in support of processes integrated within Pega Customer Service.
With the investment in Pega, the composite sees a 20% increase in productivity for back-office teams in Year 1 with subsequent gains in Years 2 and 3 of up to 30% in aggregate as more processes are integrated.
The composite utilizes 50% of the time of 10 technical engineers supporting business processes before the investment in Pega.
After deploying Pega Customer Service, the composite sees a 20% increase in productivity for technical engineers in Year 1 with subsequent gains in Years 2 and 3 of up to 40% in aggregate as more processes are integrated.
The average fully burdened annual salary for a back-office FTE is $128,000. The average fully burdened annual salary for a technical engineer is $132,000.4
Improved operational productivity
Risks. Forrester recognizes that these results may not be representative of all experiences, and this benefit will vary depending on:
The organizations’ relative size, customer base, complexity of processes, and industry.
The organization’s prior solution and its capabilities.
The skill set and training of the back-office and technical professionals managing the organization’s processes.
Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $539,000.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| D1 | Back office FTEs supporting customer service processes | Composite | 50 | 50 | 50 | |
| D2 | Time spent supporting customer service processes before Pega | Composite | 20% | 20% | 20% | |
| D3 | Improved productivity with Pega | Interviews | 20% | 25% | 30% | |
| D4 | Fully burdened annual salary for a back-office staff member | Research data | $128,000 | $128,000 | $128,000 | |
| D5 | Subtotal: Improved back office staff productivity | D1*D2*D3*D4 | $256,000 | $320,000 | $384,000 | |
| D6 | Technical engineer FTEs supporting customer service processes | Composite | 10 | 10 | 10 | |
| D7 | Time spent support customer service before Pega | Composite | 50% | 50% | 50% | |
| D8 | Improved productivity with Pega | Interviews | 20% | 30% | 40% | |
| D9 | Fully burdened annual salary for a technical engineer | Research data | $132,000 | $132,000 | $132,000 | |
| D10 | Subtotal: Improved technical engineer productivity | D6*D7*D8*D9 | $132,000 | $198,000 | $264,000 | |
| D11 | Productivity recapture rate | TEI methodology | 50% | 50% | 50% | |
| Dt | Improved operational productivity | (D5+D10)*D11 | $194,000 | $259,000 | $324,000 | |
| Risk adjustment | ↓15% | |||||
| Dtr | Improved operational productivity (risk-adjusted) | $164,900 | $220,150 | $275,400 | ||
| Three-year total: $660,450 | Three-year present value: $538,763 | |||||
Evidence and data. Interviewees’ organizations experienced cost savings by consolidating their technical stack while lowering licensing and equipment costs with the investment in Pega Customer Service. They eliminated legacy customer service systems, CRM, workflow automation, case management, and ticketing solutions, among others.
Interviewees described how their companies consolidated several processes under Pega Customer Service and gradually retired various legacy systems. The director of digital services in financial services discussed their experience: “When we started this journey, there were 25-plus systems the [CSRs] were using — maybe not in every interaction but day to day. Now, we’re close to 10 systems and we have a plan to get even those 10 integrated into Pega where the employee doesn’t need to go to other systems.”
Multiple interviewees shared how their previous solutions utilized multiple systems to handle different business needs versus having a single unified platform with Pega. The director of digital services discussed the impact on their organization: “Pega can act as a CRM and a business process management tool, where it helps us to automate the workflows. We didn’t want to have two different systems. We saved from a cost standpoint and see lot of efficiency from having one system.”
Interviewees also discussed being able to lower licensing and equipment costs driven by streamlined processes and lower turnover rates. Depending on the size of the company, the interviewees’ organizations saved between $200,000 and $1 million on equipment and licensing costs.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
The composite organization saves $500,000 in decommissioned technical infrastructure in Year 1. It sees further savings of $750,000 in Year 2 and $1 million in Year 3 as additional technical infrastructure is decommissioned.
As the composite organization sees increased productivity gains and decreased telephony volumes, it reduces software licensing and equipment for employees by $200,000 in Year 1, $300,000 in Year 2, and $400,000 in Year 3.
Risks. Forrester recognizes that these results may not be representative of all experiences, and this benefit will vary depending on:
The scope, complexity, and number of legacy systems deployed.
Whether legacy systems are in use for other purposes, preventing retirement.
The skills and capacity of the organization’s IT staff.
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 $2.3 million.
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| E1 | Decommissioned technical infrastructure | Interviews | $500,000 | $750,000 | $1,000,000 | |
| E2 | Reduction in licensing and equipment | Interviews | $200,000 | $300,000 | $400,000 | |
| Et | Decreased technical infrastructure, licensing, and equipment costs | E1+E2 | $700,000 | $1,050,000 | $1,400,000 | |
| Risk adjustment | ↓10% | |||||
| Etr | Decreased technical infrastructure, licensing, and equipment costs (risk-adjusted) | $630,000 | $945,000 | $1,260,000 | ||
| Three-year total: $2,835,000 | Three-year present value: $2,300,376 | |||||
Interviewees mentioned the following additional benefits that their organizations experienced but were not able to quantify:
Time to value for workflow development. Interviewees shared how Pega’s ability to empower teams to quickly stand up new processes and workflows helped make their companies more agile and better able to respond to new customer needs and trends. According to interviewees, leveraging Pega’s straightforward, low-code interface for IT and business users helped their companies see an average 8x improvement in time to value for workflow and process development.
Improved time to value for workflow and process development
Improved audit and compliance protection. The vice president of IT in healthcare discussed how Pega has helped their company be better positioned to meet compliance standards: “Our audit readiness was much better because every interaction is logged, time-stamped, and traceable. With role-based access and data masking, customer information is protected and we have reduced the risk of any unauthorized access to sensitive data.”
Improved customer and employee satisfaction. With improved customer service through Pega’s unified platform across assisted and self-service, interviewees’ organizations saw a 20% improvement in customer satisfaction and Net Promoter ScoreSM (NPS) scores based on interviewee responses.5 Similarly, the interviewees’ companies saw an improvement of 20% for employee satisfaction with the simplification of processes, ease of use of the tool, and automation of previously disjointed tasks.
Improved customer and employee satisfaction
The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement Pega Customer Service and later realize additional uses and business opportunities, including:
Improved scalability for business processes and growth. Interviewees shared that, through low-code, reuseable business process architecture, Pega helped improve their companies’ ability to quickly roll out new and updated workflows across global operations. With streamlined, consistent processes across web, mobile, email, and phone interactions, the interviewees’ companies were better positioned for growth or seasonal demand without needing to rely on hiring excessive resources. The CIO in healthcare discussed their experience: “Before, we had to bring in a lot of temporary staffing that was getting out of control. In terms of scalability, we get a solution that does really scale well. [Pega] is something that’s impacting patient lives in a positive way and reducing overhead.”
Amplifying efficiencies through AI. Interviewees noted that, while their companies were utilizing Pega’s AI capabilities, in general they felt there was an opportunity to expand benefits for operational efficiencies and enhanced customer service through tools like Pega Blueprint, Pega’s Design AI Agent, which allowed business and IT teams to collaborate on designing applications and workflows utilizing generative AI (genAI) and agentic AI. The vice president of IT in healthcare discussed how their company was using AI and how they planned to expand in the future: “AI is helping us in workflow efficiency and optimizing the decision-making process. We are using genAI to create content and support intelligent virtual agents. We want to use more predictive analytics and genAI to anticipate what our patients want, and the platform can suggest the best action for them. This will improve the outcomes, engagement, and overall customer satisfaction while helping us be more agility in our operations.”
Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Total Economic Impact Approach).
| Ref. | Cost | Initial | Year 1 | Year 2 | Year 3 | Total | Present Value |
|---|---|---|---|---|---|---|---|
| Ftr | Enterprise license fees | $0 | $1,123,500 | $1,123,500 | $1,123,500 | $3,370,500 | $2,793,978 |
| Gtr | Planning, migration, and implementation costs | $1,938,000 | $0 | $0 | $0 | $1,938,000 | $1,938,000 |
| Htr | Ongoing maintenance, workflow development, and training costs | $229,425 | $834,670 | $735,080 | $635,490 | $2,434,665 | $2,073,173 |
| Total costs (risk-adjusted) | $2,167,425 | $1,958,170 | $1,858,580 | $1,758,990 | $7,743,165 | $6,805,151 |
Evidence and data. The interviewees’ organizations paid Pega for enterprise licensing based on a number of potential factors including number of users, total deployed capabilities and features, number of workflows, and outcomes.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
The composite organization purchases a three-year enterprise license for 600 total seats for their CSRs, operational support staff, management, and IT support.
Pricing may vary based on capabilities deployed. Contact Pega for more information.
Risks. Forrester recognizes that these results may not be representative of all experiences, and this cost will vary depending on:
The size of the organization and the overall scale of its engagement with Pega.
The specific services, support model, and features the organization chooses.
The pricing model deployed and the length of the contract with Pega.
Results. To account for these risks, Forrester adjusted this cost upward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $2.8 million.
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| F1 | Enterprise license fees (annual) | Interviews | $1,070,000 | $1,070,000 | $1,070,000 | |
| Ft | Enterprise license fees | F1 | $0 | $1,070,000 | $1,070,000 | $1,070,000 |
| Risk adjustment | ↑5% | |||||
| Ftr | Enterprise license fees (risk-adjusted) | $0 | $1,123,500 | $1,123,500 | $1,123,500 | |
| Three-year total: $3,370,500 | Three-year present value: $2,793,978 | |||||
Evidence and data. Interviewees’ organizations incurred costs for the initial planning, migration, and implementation of Pega Customer Service. Interviewees discussed how their companies spent time and resources in evaluating potential solutions and planning for the switch to Pega before implementing it on a concentrated number of workflows and processes.
Interviewees’ organizations utilized implementation teams of enterprise architects, technical engineers, software developers, security analysts, operational SMEs, and leadership for end-to-end planning and implementation activities. The process ranged from four months to two years dependent on the number of resources deployed, the complexity of the interviewee’s organization’s existing infrastructure, and the scope of services transitioning to Pega.
The director of digital services in financial services discussed the implementation experience for their company: “That was the best first migration [our company] had seen. We planned a lot of people on the floor on day one to make sure we are available to support employees and the feedback I got was that we overplanned. Which is always good to hear. The agents were in the next morning and were taking the calls almost like they were using Pega previously for a long time. That was a big, big deal.”
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
A 10-person team participates in the planning, migration, and implementation process.
The team spends 50% of their time over four months participating in the planning and migration process followed by five months on the system implementation.
The average fully burdened annual salary for a planning, migration, and implementation FTE is $164,000.6
The composite spends $1 million on professional services to support internal planning, migration, and implementation.
Risks. Forrester recognizes that these results may not be representative of all experiences, and this cost will vary depending on:
The number of team members involved in the planning and implementation process.
The size and complexity of the organization’s legacy processes and systems.
The number and complexity of new processes initially deployed.
The choice to hire third-party professional services to support the planning process.
Results. To account for these risks, Forrester adjusted this cost upward by 20%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $1.9 million.
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| G1 | Internal planning, migration, and implementation team FTEs | Composite | 10 | |||
| G2 | Internal planning and migration from legacy system (months) | Interviews | 5 | |||
| G3 | Implementation of Pega Customer Service platform (months) | Interviews | 4 | |||
| G4 | Percentage of FTE time spent on internal planning, migration, and implementation | Interviews | 50% | |||
| G5 | Fully burdened annual salary for an internal planning, migration, and implementation team member | Research data | $164,000 | |||
| G6 | Subtotal: Internal planning, migration, and implementation team costs | G1*((G2+G3)/12)*G4*G5 | $615,000 | |||
| G7 | Professional services supporting planning, migration, and implementation | Interviews | $1,000,000 | |||
| Gt | Planning, migration, and implementation costs | G6+G7 | $1,615,000 | $0 | $0 | $0 |
| Risk adjustment | ↑20% | |||||
| Gtr | Planning, migration, and implementation costs (risk-adjusted) | $1,938,000 | $0 | $0 | $0 | |
| Three-year total: $1,938,000 | Three-year present value: $1,938,000 | |||||
Evidence and data. Interviewees discussed how, after the initial implementation of Pega Customer Service, their companies invested in support for maintenance, workflow development, and training costs to drive continual improvements for overall customer experience while also driving operational efficiencies.
Interviewees described how Pega’s design and interface helped their companies minimize the cost for workflow development and process improvements through the use of reuseable components. The senior vice president of design in telecommunications discussed: “We built a database upfront on which we identified what reusable features we require. We selected a process with one reusable feature then the next reuseable feature and continued adding another one to the chain. That went on until we had 25 to 30 features that we could always use like interfaces, middleware integration, authentication layers, and skill management schemes you stack. That is something the platform is really good at. Also, it is very easy to integrate on the Pega side. It offers a lot of connectors and integration methodologies.”
Interviewees discussed how their companies felt it was important to invest in ongoing training for CSRs, operational staff, and IT users. The vice president of IT in healthcare shared: “We invested a lot in change management and training because people were used to a certain process and most of these people are nontechnical. We wanted to make sure that they understand the tool.”
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
There are 10 technical engineers and five software developers focused on Pega.
The technical engineers spend 25% of their time on ongoing maintenance.
The software developers spend 40% of their time on workflow development in Year 1, decreasing the time spent to 20% by Year 3.
The average fully burdened annual salary for a technical engineer is $132,000. The average fully burdened annual salary for software developer is $177,000.7
The composite starts with 525 internal users initially, which grows to 600 by year three.
Users require 10 hours of training initially, as well as 2 hours per user in each subsequent year.
The fully burdened hourly salary of users is $38.8
Risks. Forrester recognizes that these results may not be representative of all experiences, and this cost will vary depending on:
The skill set and salary levels of internal resources supporting ongoing maintenance and workflow development.
The scope and complexity of internal processes and workflows.
The average fully burdened annual salary for technical support and internal users.
Results. To account for these risks, Forrester adjusted this cost upward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $2.1 million.
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| H1 | Technical engineer FTEs focused on Pega | Composite | 10 | 10 | 10 | |
| H2 | Percentage of time spent on ongoing maintenance for Pega | Interviews | 25% | 25% | 25% | |
| H3 | Fully burdened annual salary for a technical engineer | Research data | $132,000 | $132,000 | $132,000 | |
| H4 | Subtotal: Ongoing maintenance costs for Pega Customer Service | H1*H2*H3 | $330,000 | $330,000 | $330,000 | |
| H5 | Software developer FTEs focused on Pega | Composite | 5 | 5 | 5 | |
| H6 | Percentage of time spent on workflow development | Interviews | 40% | 30% | 20% | |
| H7 | Fully burdened annual salary for a software developer | Research data | $177,000 | $177,000 | $177,000 | |
| H8 | Subtotal: Workflow development costs for Pega Customer Service | H5*H6*H7 | $354,000 | $265,500 | $177,000 | |
| H9 | Internal users on Pega | Composite | 525 | 550 | 575 | 600 |
| H10 | Training time (hours) | Interviews | 10 | 2 | 2 | 2 |
| H11 | Fully burdened hourly rate for an internal user | Research data | $38 | $38 | $38 | $38 |
| H12 | Subtotal: Training costs for Pega Customer Service | H9*H10*H11 | $199,500 | $41,800 | $43,700 | $45,600 |
| Ht | Ongoing maintenance, workflow development and training costs | H4+H8+H12 | $199,500 | $725,800 | $639,200 | $552,600 |
| Risk adjustment | ↑15% | |||||
| Htr | Ongoing maintenance, workflow development and training costs (risk-adjusted) | $229,425 | $834,670 | $735,080 | $635,490 | |
| Three-year total: $2,434,665 | Three-year present value: $2,073,173 | |||||
| Initial | Year 1 | Year 2 | Year 3 | Total | Present Value | |
|---|---|---|---|---|---|---|
| Total costs | ($2,167,425) | ($1,958,170) | ($1,858,580) | ($1,758,990) | ($7,743,165) | ($6,805,151) |
| Total benefits | $0 | $6,107,775 | $9,095,150 | $11,315,400 | $26,518,325 | $21,570,604 |
| Net benefits | ($2,167,425) | $4,149,605 | $7,236,570 | $9,556,410 | $18,775,160 | $14,765,453 |
| ROI | 217% | |||||
| Payback | 7 months |
The financial results calculated in the Benefits and Costs sections can be used to determine the ROI, NPV, and payback period for the composite organization’s investment. Forrester assumes a yearly discount rate of 10% for this analysis.
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.
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.
From the information provided in the interviews, Forrester constructed a Total Economic Impact™ framework for those organizations considering an investment in Pega Customer Service.
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 Pega Customer Service can have on an organization.
Interviewed Pega stakeholders and Forrester analysts to gather data relative to Customer Service.
Interviewed four decision-makers at organizations using Pega Customer Service to obtain data about 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 for additional information on the TEI methodology.
Benefits represent the value the solution delivers to the business. The TEI methodology places equal weight on the measure of benefits and costs, allowing for a full examination of the solution’s effect on the entire organization.
Costs comprise all expenses necessary to deliver the proposed value, or benefits, of the solution. The methodology captures implementation and 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. 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 present or current value of (discounted) cost and benefit estimates given at an interest rate (the discount rate). The PVs of costs and benefits feed into the total NPV of cash flows.
The present or current value of (discounted) future net cash flows given an interest rate (the discount rate). A positive project NPV normally indicates that the investment should be made unless other projects have higher NPVs.
A project’s expected return in percentage terms. ROI is calculated by dividing net benefits (benefits less costs) by costs.
The interest rate used in cash flow analysis to take into account the time value of money. Organizations typically use discount rates between 8% and 16%.
The breakeven point for an investment. This is the point in time at which net benefits (benefits minus costs) equal initial investment or cost.
Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists solution providers in communicating their value proposition to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of business and technology initiatives to both senior management and other key stakeholders.
1 Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists solution providers in communicating their value proposition to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of business and technology initiatives to both senior management and other key stakeholders.
2 Source: US Bureau of Labor Statistics, June 2025.
3 Ibid.
4 Ibid.
5 Net Promoter, NPS, and the NPS-related emoticons are registered U.S. trademarks, and Net Promoter Score and Net Promoter System are service marks, of Bain & Company, Inc., Satmetrix Systems, Inc. and Fred Reichheld.
6 Source: US Bureau of Labor Statistics, June 2025.
7 Ibid.
8 Ibid.
Readers should be aware of the following:
This study is commissioned by Pega 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 Pega Customer Service.
Pega 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.
Pega provided the customer names for the interviews but did not participate in the interviews.
Alexander Parsons
December 2025
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