Total Economic Impact

The Total Economic Impact™ Of Pega Cloud

Cost Savings And Business Benefits Enabled By Leveraging The Pega-As-A-Service Experience Powered By Pega Cloud

A FORRESTER TOTAL ECONOMIC IMPACT STUDY COMMISSIONED BY Pega, January 2026

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Total Economic Impact

The Total Economic Impact™ Of Pega Cloud

Cost Savings And Business Benefits Enabled By Leveraging The Pega-As-A-Service Experience Powered By Pega Cloud

A FORRESTER TOTAL ECONOMIC IMPACT STUDY COMMISSIONED BY Pega, January 2026

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Executive Summary

As organizations race to modernize their application estates and accelerate cloud-first initiatives, they continue to encounter obstacles rooted in aging on-premises environments: slow delivery cycles, scalability constraints, evolving compliance requirements, and resource strain.1 These challenges create operational drag and expose businesses to revenue risk from downtime and fragmented processes. Adopting a managed, cloud-native application platform enables enterprises to offload infrastructure management, automate updates, and scale effectively, thus laying the foundation for faster deployment, stronger compliance and governance, and improved reliability without increasing operational overhead.

The Pega-as-a-service experience, powered by Pega Cloud, offers a way to operate business-critical applications in the cloud and accelerate business transformation while mitigating the resource burden and the level of risk often associated with the transition to the cloud.

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 Cloud.2 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Pega Cloud on their organizations.

The benefits described in this study are specific to Pega Cloud tools and services that support a successful cloud migration and ongoing operation. This analysis focuses on the combined benefits, costs, and risks of migrating to and developing applications natively on Pega Cloud. Previous TEI research has examined the value of individual Pega offerings, including Pega Customer Decision Hub and Pega Customer Service (see Appendix B for study references). This TEI does not address potential benefits, costs, or risks of other deployment approaches — such as on-premises or alternative cloud models — in cases where public or private cloud, or as-a-service deployments, are not feasible due to data residency, security, compliance, or performance constraints.

71%

Return on investment (ROI)

 

$2.6M

Net present value (NPV)

 

To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed four decision-makers with experience using Pega Cloud. For the purposes of this study, Forrester aggregated the experiences of the interviewees and combined the results into a single composite organization, which is a multinational enterprise generating $5 billion in annual revenue with 40,000 employees.

Interviewees said that prior to adopting Pega Cloud, their organizations hosted applications on-premises using legacy servers, virtual machines, or high-code custom solutions. This created operational challenges including heavy IT workloads for maintenance and patching, slow deployment of new applications, limited scalability and reliability, and complex compliance and audit processes. These gaps created operational inefficiencies, delayed application delivery, and in some cases, resulted in lost revenue due to system downtime.

After the investment in Pega Cloud and leveraging the end-to-end services from the Pega-as-a-service offering, interviewees reported a more efficient, cloud-first solution that reduced operational overhead, accelerated application deployment cycles, and improved system reliability. Key results from the investment include lower legacy infrastructure and maintenance costs, as well as productivity improvements for QA and development teams. The investment also accelerated release of Pega applications, safeguarded revenue through reduced customer-facing downtime, and improved end-user productivity through reduced internal-facing downtime. Platform-level improvements also enabled a range of application-level benefits, including faster customer response times, streamlined workflows, improved scalability, more effective omnichannel engagement, and higher customer conversion rates. These outcomes served to deliver additional business value while also supporting organizational growth and accelerating innovation.

Key Findings

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

  • Up to a 70% reduction in on-premises infrastructure costs. The composite organization reduces on-premises hardware needs and lowers infrastructure staff by migrating Pega apps to the Pega Cloud and offloading routine maintenance, patching, and monitoring to Pega Cloud. Automated updates and scalable cloud capacity free up staff for higher-value work while lowering capital and operational costs. These improvements yield a present value of $1.6 million.

  • Up to a 40% reduction in time spent testing Pega applications. After migrating to Pega Cloud, the composite organization leverages managed DevOps tooling — including Deployment Manager, governed pipelines, and automated regression capabilities — to accelerate configuration validation and multiscenario test execution. Faster, more predictable testing reduces manual effort and frees QA teams to focus on higher-value development and testing activities. These productivity gains yield a present value of $189,000.

  • Up to a 50% reduction in developer time spent on Pega application administration and configuration. The composite organization reduces developer time spent on environment setup, application deployment, patching, and configuration through automation, preprovisioned environments, and reusable templates. Developers complete routine tasks faster and redirect effort toward higher-value work. These productivity gains yield a present value of $1.2 million.

  • Up to a 50% reduction in Pega application delivery timelines. The composite organization accelerates delivery by hosting applications on Pega Cloud, which provide elastic scalability, automated patching, near-zero-downtime upgrades, and centralized DevOps tooling for streamlined deployment and testing. These managed Pega Cloud capabilities eliminate infrastructure constraints and manual environment setup so teams can roll out new revenue-generating applications faster and capture incremental revenue that would have been delayed in the prior on-prem environment. These improvements yield a present value of $452,000.

  • Up to a 75% reduction in internal-facing downtime events. The composite organization benefits from Pega applications that have been migrated to Pega Cloud, including case management, workflow automation, decisioning, and operational dashboards, which employees across IT, finance, HR, and business teams rely on to perform critical work. Automated patching, near-zero-downtime updates, redundant cloud environments, and proactive monitoring keep applications available and minimize disruptions. These improvements yield a present value of $2.7 million.

  • Up to a 70% reduction in customer-facing downtime events. The composite organization protects revenue by maintaining high availability of customer-facing Pega Cloud-hosted applications through redundant architecture, near-zero-downtime updates, automated scaling, and proactive monitoring. These improvements reduce service disruptions and preserve revenue that was at risk in the prior environment during downtime events. These benefits yield a present value of $132,000.

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

  • Platform-level benefits. Pega Cloud provides foundational capabilities for the composite organization that support operational scalability, compliance, and organizational growth by eliminating infrastructure constraints and automating core operational tasks. The composite organization benefits from elastic autoscaling and reusable components that remove the need for hardware procurement and capacity planning; streamline onboarding of new business units through rapid environment provisioning; and reduce risk and accelerate approvals due to inherited compliance frameworks, such as FedRAMP and HIPAA, and automated patching and audit trails. These managed Pega Cloud capabilities allow the composite organization’s teams to avoid manual, error-prone processes and focus on higher-value work, while low-code configuration further improves employee experience.

  • Application-level benefits. The composite organization runs business-critical and customer-facing Pega applications on Pega Cloud, which enhances the applications’ effectiveness and reliability by leveraging near-zero-downtime upgrades, automated patching, elastic scalability, and centralized DevOps tooling. These capabilities enable faster resolution of customer inquiries, more consistent omnichannel service, reduced manual effort, higher sales conversion and revenue growth, greater capacity to process incoming cases and customer requests efficiently, and accelerated time to market through rapid prototyping and iterative development — improvements that would have been slower and riskier to achieve in a legacy on-prem environment.

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

  • Fees to Pega totaling $2.0 million. The composite organization pays subscription fees based on the number of Pega Cloud–hosted applications and cumulative case volumes, which scale as additional applications are migrated. The subscription provides access to Pega Infinity Platform, Pega GenAI platform capabilities, Agile Studio, Pega Cloud environments, storage, and monitoring tools, enabling efficient management and operation of applications on Pega Cloud.

  • Implementation costs of $1.4 million. The composite organization incurs third-party professional services fees and dedicates internal IT and business resources to migrating and integrating Pega applications onto Pega Cloud. While subscription fees cover platform maintenance and upgrades, the composite organization spends time and consults support during initial migrations and as additional applications are implemented in subsequent years. The majority of the migration cost is spent on updating older applications to support Pega best practices and ensure they are cloud-ready while also updating internal client systems to support native cloud integrations.

  • Ongoing costs of $309,000. The composite organization dedicates IT and business resources to governance, configuration changes, and vendor coordination for Pega application management. These activities ensure requests are validated, best practices are followed, and the platform continues to operate efficiently, with internal teams engaging in periodic planning, change implementation, and collaboration with Pega.

The financial analysis that is based on the interviews found that a composite organization experiences benefits of $6.3 million over three years versus costs of $3.7 million, adding up to a net present value (NPV) of $2.6 million and an ROI of 71%.

Additional uptime due to reduced internal-facing downtime

44 hours

Revenue recaptured due to accelerated time to market for new Pega applications

$6.9M

Key Statistics

71%

Return on investment (ROI) 

$6.3M

Benefits PV 

$2.6M

Net present value (NPV) 

8 months

Payback 

[CHART DIV CONTAINER]
Reduced legacy infrastructure spend and management effort Increased QA productivity due to faster app testing Increased developer productivity due to streamlined app administration and configuration Accelerated time to market Improved operational efficiency due to reduced internal-facing downtime Improved business continuity due to reduced customer-facing downtime

The Pega Cloud Customer Journey

Drivers leading to the Pega Cloud investment
Interviews
Role Industry Region Employees Revenue
Executive director, decisioning Financial services Multinational 200,000 $100B
Senior IT lead Financial services EMEA 50,000 $6B
CIO Government US 80,000 Budget: $5B
VP, IT Healthcare US 1,600 $400B
Key Challenges

Prior to upgrading to the Pega-as-a-service experience powered by Pega Cloud, interviewees’ organizations hosted both internally and externally facing applications on-premises with legacy servers, virtual machines, or high-code custom solutions. The resulting manual processes and ongoing internal responsibilities for patching, upgrades, scaling, and compliance checks left interviewees’ organizations unable to maintain currency or meet business goals as they struggled with common challenges, including:

  • Heavy operational workload. Interviewees said their IT teams spent significant time managing servers, virtual machines, patching, upgrades, backups, and scaling to support applications, limiting capacity for strategic work. The CIO in government described the added operational complexity in the prior state specific to maintenance windows, obtaining security approvals, and provisioning servers: “[Applications in our legacy environment] had to have annual maintenance windows, various, what we call security approvals, ATO [authorization to operate] packages, and, in some cases, we had to scale up and order new VMs [virtual machines], blades, servers, etc., and [those orders] could have various lead times. And, obviously, we had other integrations and items that we had to manage between other products.”

  • Slow deployment and environment provisioning. Before Pega Cloud, the interviewees agreed that rolling out new applications or updates required lengthy coordination, hardware procurement, and internal approvals. Development and deployment delays negatively impacted their organizations’ abilities to meet business initiatives and strategic goals.

  • Limited scalability and reliability. On-premises systems could not easily handle high-volume workloads or peak demand, and unplanned outages caused disruptions for internal operations. As such, many interviewees said their legacy environments were restricted in terms of the use cases or volumes of applications that could be deployed. For instance, a senior IT lead at a financial services organization had high-code applications prior to Pega Cloud that were focused on supporting internal employee use cases. They indicated that they purchased Pega Cloud to scale to include both internal and customer-facing applications in the cloud, stating, “We bought Pega to do both; to not only service our internal employees or our account managers but also for customers who directly engage with the [bank] on the internet for more of the self-service type approach.” Some interviewees also tied downtime in the prior environment to lost revenue to further implicate reliability restrictions in their organizations’ inability to meet business goals.

  • Complex compliance and audit processes. According to interviewees, maintaining regulatory standards and audit readiness required manual checks and extensive internal effort, increasing operational risk and resource use in the prior state. The VP of IT at a healthcare organization described prior compliance processes as both manual and cumbersome. As such, timeline delays were not the only risk — the lack of audit trail increased the risk of noncompliance as well.

Investment Objectives

The interviewees searched for a solution that met technical objectives, including the following:

  • Reduced operational overhead and boosted productivity for IT, developer, QA, and operations resources, providing employees more time to focus on strategic projects, faster testing cycles, and more efficient application delivery.

  • Optimized infrastructure and legacy system costs by consolidating on-premises environments and reducing hardware and infrastructure maintenance.

  • Accelerated time to market and facilitated innovation efforts with shorter development cycles and by preprovisioning cloud environments with reusable infrastructure and streamlined release processes.

  • Increased scalability and reliability by ensuring systems could handle growing workloads and peak periods without disruption, supporting uninterrupted operations and consistent service delivery.

  • Simplified compliance and risk management with built-in audit, monitoring, and compliance capabilities to reduce manual effort, improve regulatory adherence, and lower operational risk.

Additionally, each of the interviewees’ organizations deployed different Pega applications to the Pega Cloud as part of their investment journey with the objective of driving business value through innovation:

  • The executive director of decisioning said their financial services organization sought to leverage Pega’s strong modeling capabilities to create a centralized location for their audience that would improve engagement with customers across touchpoints. By deploying their Pega decisioning and customer engagement applications on Pega Cloud, their organization avoided infrastructure constraints and accelerated delivery through rapid provisioning and automated updates, which would have been slower and more resource-intensive on-prem. 

  • The senior IT lead at a different financial services organization said they wanted to unify customer and employee experiences and increase self-service capabilities for customers amidst the institution’s broader push towards digital experiences. Pega Cloud enabled this by providing elastic scalability and continuous compliance controls, allowing their organization to expand securely without the delays and manual effort associated with legacy deployments.

  • The CIO from a government organization noted that they needed to respond to cloud-first mandates within the industry by evolving and modernizing existing internal processes to better meet customer expectations.

  • The VP of IT said their healthcare organization had both industry compliance requirements and geographical regulation requirements to meet through a secure cloud offering and without restricting the businesses’ ability to grow. 

After a request for proposal (RFP) and business case process evaluating multiple vendors, the interviewees’ organizations chose Pega Cloud to meet both technical and business objectives for many reasons, including:

  • A fully managed, cloud-first platform.

  • Built-in security, compliance, and audit trails.

  • Scalable infrastructure.

  • Expert support and accelerated adoption timelines.

  • Industry-specific configurability.

  • Future-ready capabilities such as low-code and generative AI (genAI).

“The value basically is that we’ve built up a capability across the years in the investments that we made in Pega and in our people. The new features that Pega brings, such as Constellation, help the productivity of developers. Our main goal for the future is to either do the same thing with less developers or do more with the same amount. That’s our long-term vision.”

Senior IT lead, financial services

“A lot of times, we will get new referrals from our insurance providers but we’re not able to handle all the intake so we would often miss out on the opportunities. But now, whenever there is a referral from our insurance companies or from our peers, we can convert most of them because they’re already approved. I would say the good thing with Pega Cloud is that we are able to expand our operations without worrying about infrastructure limits and without scaling our application — it scales by itself.”

VP, IT, healthcare

Composite Organization

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 multinational, industry-agnostic enterprise has an annual revenue of $5 billion. It also has a complex environment and a heavily process-centric customer service operations where customer value management is a top objective.

  • Deployment characteristics. The composite organization previously deployed Pega applications on-premises to support multiple mission-critical business functions. Over three years, the composite organization migrates a total of 20 Pega applications to Pega Cloud, including 12 customer-facing applications, such as service and engagement solutions, and eight employee-facing applications supporting internal workflows, case management, and operational processes.
    The composite’s cloud environment includes one production instance, two sandboxes (large and standard), and entitlements for Pega Platform, the Pega GenAI platform package (Automate, Analyze, Coach, Connect), and Pega Agile Studio. Cloud services include 250 GB of production data storage, 500 GB of file storage, Pega Deployment Manager for DevOps pipeline automation, and Pega Predictive Diagnostic Center for application health monitoring. Implementation and ongoing migration are supported by third-party professional services, while internal IT and business resources dedicate time to deployment, ongoing configuration, governance, and vendor management activities.

 KEY ASSUMPTIONS

  • $5 billion in annual revenue

  • 40,000 employees

  • Multinational, industry-agnostic enterprise

  • 20 total Pega apps deployed on Pega Cloud by Year 3

Analysis Of Benefits

Quantified benefit data as applied to the composite
Total Benefits
Ref. Benefit Year 1 Year 2 Year 3 Total Present Value
Atr Reduced legacy infrastructure spend and management effort $584,244 $606,744 $747,180 $1,938,168 $1,593,940
Btr Increased QA productivity due to faster app testing $43,416 $75,978 $115,776 $235,170 $189,245
Ctr Increased developer productivity due to streamlined app administration and configuration $440,640 $495,720 $550,800 $1,487,160 $1,224,092
Dtr Accelerated time to market $138,462 $184,615 $230,769 $553,846 $451,829
Etr Improved operational efficiency due to reduced internal-facing downtime $935,000 $1,092,080 $1,256,640 $3,283,720 $2,696,678
Ftr Improved business continuity due to reduced customer-facing downtime $46,119 $53,425 $61,188 $160,732 $132,051
  Total benefits (risk-adjusted) $2,187,881 $2,508,562 $2,962,353 $7,658,796 $6,287,835
Reduced Legacy Infrastructure Spend And Management Effort

Evidence and data. Interviewees explained that prior to migrating to the Pega-as-a-service experience with Pega Cloud, their organizations faced high infrastructure costs and operational complexity due to manual patching, upgrades, and hardware procurement cycles These environments required specialized skills spanning system administration, database management, middleware, and network security, which elevated risk and support costs.

After migrating their Pega apps from on-prem to Pega Cloud, interviewees said these burdens were eliminated through automated patching, monitoring, and auto-scaling. Organizations offloaded routine maintenance and infrastructure management to Pega’s fully managed platform, which reduced hardware requirements and freed staff to focus on more strategic initiatives.

  • The VP of IT at the healthcare organization reported that dedicated hardware and infrastructure costs for Pega applications were eliminated following the migration to Pega Cloud. In the prior environment, their organization incurred between $200,000 to $300,000 annually in hardware expenses. Decommissioning occurred gradually because some infrastructure was shared with other applications but the dedicated spend for Pega was ultimately eliminated.

  • The CIO at the government organization explained: “By centralizing management, we achieved about 90% efficiency [in infrastructure operations] as a result of moving to a single instance and with Pega’s help managing it. For us, that’s a high level of return.”
    The CIO also emphasized the broader operational impact of migrating to Pega Cloud: “Before Pega Cloud, scaling applications required provisioning more hardware, which meant lengthy procurement cycles and contracts for staffing and outsourced IT labor to manage data center environments. We had on-prem Pega models sized for specific areas — often 10 to 20 servers — with annual server, storage, and compute costs reaching $1 million to $2 million per area, multiplied across 15 to 20 areas. With Pega Cloud, scalability is effectively elastic. We save 75% of that cost and eliminate weeks or even months of procurement delays. Historically, underutilization was 30% to 40%, which wasted resources. Moving to Pega Cloud improved that effective rate significantly.”

  • The executive director of decisioning at the financial services organization explained: “In the financial services industry, organizations tend to have a lot of outdated infrastructure. It takes a lot of time and effort to maintain, and you also have to keep the knowledge base with people who are familiar with it. If somebody leaves the company, then you’re obviously not in a good place because they won’t know the historical context of what’s going on. With [Pega Cloud], that problem goes away. It’s Pega’s responsibility at the end of the day to keep the knowledge and make sure everything is still operational. We don’t have to update our own infrastructure or keep people who might want to do something else. It requires a particular skill set to continuously monitor these things.”

  • The senior IT lead at the financial services organization noted: “Since migrating our Pega apps, we don’t need to manage much internally anymore. We used to have about 20 people managing our infrastructure clusters, which is now done by Pega. Those people have since been reallocated to something else. We now run the platform with six people instead of 20 — those people make sure our integrations are up to standard; SSO [single sign-on], authentication, all of these things you still need to have with the cloud.”

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

  • The composite organization has eight infrastructure staff dedicated to managing Pega applications on-premises.

  • With Pega Cloud, the composite reduces infrastructure staff dedicated to managing Pega apps by 50% in Year 1, 55% in Year 2, and 60% in Year 3.

  • The average fully burdened annual salary for an infrastructure staff member is $131,040.

  • The composite’s on-premises infrastructure costs in the prior environment were $250,000 annually.

  • With Pega Cloud, the composite reduces on-premises infrastructure costs by 50% in Year 1, 60% in Year 2, and 70% in Year 3.

Risks. This benefit will vary among organizations based on:

  • Number of infrastructure staff dedicated to managing on-premises applications.

  • Average fully burdened annual salary of infrastructure staff.

  • Annual on-premises infrastructure costs prior to migration.

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 $1.6 million.

70%

Reduction in on-premises infrastructure costs with Pega Cloud by Year 3

“Running Pega on-prem meant system administrators, database administrators, middleware specialists, and network security engineers were all involved in patching and upgrades. After migrating to the [Pega] Cloud, Pega handles OS and middleware patching, database management, monitoring, disaster recovery, and continuous platform upgrades. Our resource count dropped from 12 to 16 to about five to six per division. We’ve unlocked over a million dollars in annual labor savings.”

CIO, government

Reduced Legacy Infrastructure Spend And Management Effort
Ref. Metric Source Year 1 Year 2 Year 3
A1 Infrastructure staff dedicated to managing Pega apps on-premises Composite 8 8 8
A2 Reduction in infrastructure staff dedicated to managing Pega apps on-premises Interviews 50% 55% 60%
A3 Infrastructure staff previously dedicated to managing Pega apps on-premises (rounded) A1*A2 4 4 5
A4 Fully burdened annual salary for an infrastructure staff member Composite $131,040 $131,040 $131,040
A5 Subtotal: Infrastructure staff cost savings A3*A4 $524,160 $524,160 $655,200
A6 On-premises infrastructure costs in the prior environment Composite $250,000 $250,000 $250,000
A7 Percentage reduction in on-premises infrastructure costs with Pega Cloud Interviews 50% 60% 70%
A8 Subtotal: Reduced on-premises infrastructure spend A6*A7 $125,000 $150,000 $175,000
At Reduced legacy infrastructure spend and management effort A5+A8 $649,160 $674,160 $830,200
  Risk adjustment 10%      
Atr Reduced legacy infrastructure spend and management effort (risk-adjusted)   $584,244 $606,744 $747,180
Three-year total: $1,938,168 Three-year present value: $1,593,940
Increased QA Productivity Due To Faster App Testing

Evidence and data. Interviewees reported that moving applications to the Pega-as-a-service solution on Pega Cloud substantially improved QA productivity. Managed DevOps operations in the Pega-as-a-service offering — including the preprovisioned Deployment Manager, standardized release pipelines, and enforced change controls — orchestrated customer and product test automations within the managed pipeline. Teams were able to redirect their focus from repetitive manual work to higher-value testing and development activities, thus increasing their overall delivery capacity. Interviewees emphasized several key sources of value, including:

  • Automated regression testing and validation of complex configurations. For the interviewees’ organizations, testing activities that previously consumed the majority of development cycles became faster and more predictable with the Pega-as-a-service solution’s managed operations governing Pega tooling. Interviewees highlighted that automation helped balance development and QA capacity, particularly in environments with frequent configuration changes or complex setups.
    The executive director of decisioning at the financial services organization described the shift: “Testing does two big things for us: first, it automates regression testing so we can move much faster. Second, as we make configuration changes, it helps us confirm they’re accurate. It’s really about being preventative; building scenarios that catch issues early; and automating them to keep development flowing.”
    They further explained that development was often not the bottleneck; testing was: “[The] development capability is actually not a lot of work. The majority of the work ends up being with the testing teams. … Maybe you’re spending two points on the capability, but you might end up spending like five or six points from a testing perspective. So now, all of a sudden, your capacity to develop tends to be more than the capacity you have from a testing perspective. This is where the automation comes in extremely handy so you can balance the two out.”

  • Reduced manual test cycles despite GUI-driven configuration complexity. Interviewees whose organizations had customized environments cited higher testing burdens. Automation orchestrated through Deployment Manager and standardized environments within the Pega-as-a-service solution offset the expanded testing surface caused by modern, GUI-driven configuration, which reduced the manual effort required for validation.
    The executive director of decisioning at the financial services organization explained: “With the modern interface, you gain flexibility, but you also increase the testing surface. Once you introduce GUI-driven configuration, you need new scenarios to validate it. In the past, there was far less to manage, but automation in Pega Cloud makes that growth manageable.”

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

  • The composite organization migrates 10 Pega apps to Pega Cloud in Year 1, 15 by Year 2, and 20 by Year 3.

  • Each Pega app is tested four times per month on average.

  • In the prior environment, each testing cycle took 10 hours.

  • With Pega Cloud, the composite reduces time spent app testing by 30% in Year 1, 35% in Year 2, and 40% in Year 3.

  • The fully burdened hourly rate for a QA tester is $67.

  • For this benefit, the composite has a productivity recapture rate of 50%. QA testers spend half of the time they save on activities that generate business value, but not all reclaimed time is dedicated to value-added work.

Risks. This benefit will vary among organizations based on:

  • Number of Pega apps migrated to Pega Cloud.

  • Average Pega app testing frequency per app per month.

  • Average time spent testing per cycle in the prior environment.

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 $189,000.

40%

Reduction in time spent app testing with Pega Cloud by Year 3

Increased QA Productivity Due To Faster App Testing
Ref. Metric Source Year 1 Year 2 Year 3
B1 Pega apps migrated to Pega Cloud Composite 10 15 20
B2 Average Pega app testing frequency per app per month Composite 4 4 4
B3 Average time spent testing per cycle in the prior environment (hours) Composite 10 10 10
B4 Reduction in time spent app testing with Pega Cloud Interviews 30% 35% 40%
B5 Time of app testing recaptured for productive use per testing cycle with Pega Cloud (hours rounded) B3*B4 3.0 3.5 4.0
B6 Total app testing time reclaimed with Pega Cloud (hours) B1*B2*12 months*B5 1,440 2,520 3,840
B7 Fully burdened hourly rate for a QA tester Composite $67 $67 $67
B8 Productivity recapture TEI methodology 50% 50% 50%
Bt Increased QA productivity due to faster app testing B6*B7*B8 $48,240 $84,420 $128,640
  Risk adjustment 10%      
Btr Increased QA productivity due to faster app testing (risk-adjusted)   $43,416 $75,978 $115,776
Three-year total: $235,170 Three-year present value: $189,245
Increased Developer Productivity Due To Streamlined App Administration And Configuration

Evidence and data. Interviewees reported that Pega Cloud automated key administrative and configuration tasks, including environment setup, application deployment, patching, and version management, which led to improved developer productivity. Preprovisioned cloud environments, reusable templates, and simplified configuration tools reduced the manual effort developers previously spent deploying and maintaining applications. As a result, developers completed routine tasks faster and dedicated more time to strategic initiatives such as feature enhancements, new application development, and performance and quality improvements.

  • The executive director of decisioning at the financial services organization shared: “[We’re] developing more now because we can do more in a sprint than we were doing before. With automation testing, whenever we do an upgrade, because we have automation scripts, we can do the upgrade faster to ensure things are working as intended. That capacity goes to development and other testing. I would never say you’re getting rid of those people. It’s just increasing your capacity of what you’re able to do.”

  • The senior IT lead in financial services explained: “Most of the administrative parts are now automated. It’s workflow optimization that saves time. Our developers are doing more work in the same amount of time. It’s about completing tasks faster and giving them the opportunity to work on other projects that are of interest to them.”

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

  • Of the composite’s 800 developers, 15% have access to Pega Cloud and experience productivity gains from streamlined app administration and configuration.

  • In the prior environment, developers spent 20 hours per month on app administration and configuration.

  • With Pega Cloud, the composite reduces developer time spent on these activities by 40% in Year 1, 45% in Year 2, and 50% in Year 3.

  • The fully burdened hourly rate for a developer is $85.

  • For this benefit, the composite has a productivity recapture rate of 50%. Developers spend half of the time they save on activities that generate business value, but not all reclaimed time is dedicated to value-added work.

Risks. This benefit will vary among organizations based on:

  • Number of developers with access to Pega Cloud.

  • Average developer time spent on app administration and configuration per month in the prior environment.

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 $1.2 million.

50%

Reduction in developer time spent on app admin and configuration with Pega Cloud by Year 3

Increased Developer Productivity Due To Streamlined App Administration And Configuration
Ref. Metric Source Year 1 Year 2 Year 3
C1 Developers Composite 800 800 800
C2 Percentage of developers with access to Pega Cloud Composite 15% 15% 15%
C3 Developers with access to Pega Cloud C1*C2 120 120 120
C4 Average developer time spent on app admin and configuration per month in the prior environment (hours) Composite 20 20 20
C5 Reduction in developer time spent on app admin and configuration with Pega Cloud Interviews 40% 45% 50%
C6 Total developer time reclaimed (hours) C3*C4*12 months*C5 11,520 12,960 14,400
C7 Fully burdened hourly rate for a developer Composite $85 $85 $85
C8 Productivity recapture TEI methodology 50% 50% 50%
Ct Increased developer productivity due to streamlined app administration and configuration C6*C7*C8 $489,600 $550,800 $612,000
  Risk adjustment 10%      
Ctr Increased developer productivity due to streamlined app administration and configuration (risk-adjusted)   $440,640 $495,720 $550,800
Three-year total: $1,487,160 Three-year present value: $1,224,092
Accelerated Time To Market

Evidence and data. Interviewees reported that hosting applications on Pega Cloud accelerated time to market by eliminating infrastructure constraints and automating core operational tasks such as environment setup, patching, and upgrades. Elastic scalability, centralized DevOps tooling, and near-zero-downtime updates allowed their teams to build and enhance applications more quickly, which brought customer-facing applications to market faster and enabled their organizations to unlock revenue several weeks earlier than in the on-premises environment. Key mechanisms cited by interviewees include:

  • Streamlined deployment and reusable components. Pega Cloud’s centralized DevOps tooling and automated patching reduced manual setup and coordination for the interviewees’ organizations, which enabled faster rollouts and modifications for both minor weekly updates and larger monthly releases.
    The executive director of decisioning in financial services explained: “Efficiency has definitely improved because of the cloud capabilities versus on-prem. With Pega Cloud, we have reusable components and templates that make deployment faster. You can reuse components and modify strategies without introducing new conversations, which helps us roll out updates and enhancements quickly
    The executive director continued: “We rolled out conversion models using reusable components. We started with one page in the application, tested it, and then rolled it out to other pages within the same app. We already had a component for that first page, and now we’re modifying it for others. The logic is mostly the same, which lets us make it available to additional pages quickly.”

  • Faster configuration for new use cases. Interviewees said their teams were able to implement new targeting, logic changes, or additional capabilities with minimal setup due to low-code configuration with cloud-managed infrastructure, which avoided delays tied to hardware provisioning and manual environment preparation.
    The executive director of decisioning in financial services described: “Someone on our team had the idea to target a specific customer segment and we were very quickly and easily able to add that additional targeting capability. It didn’t require much additional configuration.”

  • Increased application throughput. By reducing manual effort and providing elastic scalability and automated testing through Pega Cloud’s managed DevOps pipelines, organizations were able to increase the number of applications they developed concurrently. This allowed them to expand functionality, support new business initiatives, and respond to market opportunities faster than was possible with on-premises systems.

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

  • The composite generates $50 million in annual revenue from new customer-facing applications built on Pega solutions. This figure is derived from the organization’s $5 billion annual revenue, with 10% allocated to customer-facing applications built on Pega solutions and 10% of that portion representing new applications rather than recurring revenue.

  • In the prior environment, the composite released two new applications per year.

  • Each new application generates approximately $480,769 in revenue per week.

  • In the prior environment, it took six weeks to deliver a new application.

  • With Pega Cloud, the composite reduces app delivery timelines by 30% in Year 1, 40% in Year 2, and 50% in Year 3.

  • The composite’s operating margin is 10%.

Risks. This benefit will vary among organizations based on:

  • Average revenue from new customer-facing applications built on Pega solutions.

  • Average annual app release frequency in the prior environment.

  • Average number of weeks to deliver a new app in the prior environment.

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 $452,000.

50%

Reduction in app delivery timeline with Pega Cloud by Year 3

“Productivity is definitely one of the main benefits, largely because of the reuse of components. If the components are in place, a new application can be up and running in a couple of weeks. Without Pega Cloud, it would take double or even triple that time.”

Senior IT lead, financial services

Accelerated Time To Market
Ref. Metric Source Year 1 Year 2 Year 3
D1 Average revenue from new customer-facing applications built on Pega solutions Composite $50,000,000 $50,000,000 $50,000,000
D2 Average annual app release frequency in the prior environment Composite 2 2 2
D3 Average revenue built on Pega solutions per new app per week (D1/D2)/52 weeks $480,769 $480,769 $480,769
D4 Average time to deliver a new app in the prior environment (weeks) Composite 6 6 6
D5 Reduction in app delivery timeline with Pega Cloud Interviews 30% 40% 50%
D6 Total time reclaimed from faster app releases (weeks rounded) D2*D4*D5 3.6 4.8 6.0
D7 Revenue recaptured from faster app releases D3*D6 $1,730,768 $2,307,691 $2,884,614
D8 Operating margin Composite 10% 10% 10%
Dt Accelerated time to market D7*D8 $173,077 $230,769 $288,461
  Risk adjustment 20%      
Dtr Accelerated time to market (risk-adjusted)   $138,462 $184,615 $230,769
Three-year total: $553,846 Three-year present value: $451,829
Improved Operational Efficiency Due To Reduced Internal-Facing Downtime

Evidence and data. Interviewees shared that Pega Cloud improved operational efficiency by reducing downtime for internal-facing Pega applications, including case management systems, workflow automation tools, and operational dashboards that employees across IT, finance, HR, and business teams rely on to perform critical work. Automated patching, near-zero-downtime updates, redundant cloud environments, and proactive monitoring with the Predictive Diagnostic Center enabled their IT teams to resolve issues faster, which kept operational environments available and mitigated subsequent productivity losses for the affected employees. Nonproduction environments, such as development and testing systems, also experienced reduced downtime, which allowed the interviewees’ organizations’ IT teams to maintain smooth internal operations. Pega Cloud’s ability to scale vertically and horizontally ensured that their applications handled peak usage without performance degradation.

  • The executive director of decisioning in financial services noted: “Whenever you have a problem with the cloud, you have vendor support that helps catch issues. When it’s on-prem, it’s more like it’s on you specifically to look after it. You have additional support from a vendor perspective that you wouldn’t have as much in the on-prem environment. This means that when we have upgrades, they happen really fast and we experience very little downtime. From that perspective, it’s seamless compared to on-prem.”

  • The VP of IT in healthcare reflected on prior challenges, noting: “Before moving to the cloud, there were weak points in the system that meant we were always firefighting. With Pega, I don’t have to worry. The systems are always operational and available. We experience 99.99% availability.”

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

  • The composite has 40,000 employees with 10% impacted by downtime of internal Pega applications during each event.

  • In the prior environment, the composite experienced eight internal-facing downtime events per year, each lasting 4 hours.

  • With Pega Cloud, the composite reduces downtime events by 60% in Year 1, 65% in Year 2, and 70% in Year 3. It also shortens downtime duration per incident by 65% in Year 1, 70% in Year 2, and 75% in Year 3.

  • The fully burdened hourly rate for an affected employee is $44.

  • For this benefit, the composite has a productivity recapture rate of 50%. Employees spend half of the time they save on activities that generate business value, but not all reclaimed time is dedicated to value-added work.

Risks. This benefit will vary among organizations based on:

  • Total number of employees.

  • Average percentage of employees impacted by downtime of internal Pega apps.

  • Average internal-facing downtime events per year in the prior environment.

  • Average internal-facing downtime per event in the prior environment.

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 $2.7 million.

70%

Reduction in internal-facing downtime events with Pega Cloud by Year 3

Improved Operational Efficiency Due To Reduced Internal-Facing Downtime
Ref. Metric Source Year 1 Year 2 Year 3
E1 Total employees Composite 40,000 40,000 40,000
E2 Average percentage of employees impacted by downtime of internal Pega apps Composite 10% 10% 10%
E3 Average employees impacted per downtime event E1*E2 4,000 4,000 4,000
E4 Average internal-facing downtime events per year in the prior environment Composite 8 8 8
E5 Reduction in internal-facing downtime events with Pega Cloud Interviews 60% 65% 70%
E6 Average internal-facing downtime events avoided with Pega Cloud (rounded) E4*E5 4.8 5.2 5.6
E7 Average internal-facing downtime per event in the prior environment (hours) Composite 4 4 4
E8 Reduction in downtime duration per incident with Pega Cloud Interviews 65% 70% 75%
E9 Average internal-facing downtime reclaimed per event with Pega Cloud (hours) (rounded) E7*E8 2.6 2.8 3.0
E10 Subtotal: Additional internal uptime with Pega Cloud (hours) (rounded) E6*E9 12.5 14.6 16.8
E11 Fully burdened hourly rate for an affected employee Composite $44 $44 $44
E12 Productivity recapture TEI methodology 50% 50% 50%
Et Improved operational efficiency due to reduced internal-facing downtime E3*E10*E11*E12 $1,100,000 $1,284,800 $1,478,400
  Risk adjustment 15%      
Etr Improved operational efficiency due to reduced internal-facing downtime (risk-adjusted)   $935,000 $1,092,080 $1,256,640
Three-year total: $3,283,720 Three-year present value: $2,696,678
Improved Business Continuity Due To Reduced Customer-Facing Downtime

Evidence and data. Interviewees emphasized that Pega-as-a-service applications enabled their organizations to deliver uninterrupted service to customers by minimizing downtime and maintaining consistent performance of customer-facing applications. Redundant cloud architecture, near-zero-downtime updates, automated scaling, and proactive monitoring through the Pega Diagnostic Center (PDC) allowed their IT teams to detect and resolve issues before they affected customers. In addition, Pega Cloud’s enforcement of cloud-native design best practices helped their teams build applications that were inherently more resilient and performant, which further reduced the risk of disruptions during peak usage. These improvements enabled the interviewees’ organizations to safeguard revenue that had previously been at risk during customer-facing downtime.

  • The CIO at the government organization noted: “Managed patching for customer-facing applications went from 30 to 40 days on-prem to less than seven days in Pega Cloud. Pega has a 24/7 patch pipeline, automatic regression testing across the redundant environment, and can push critical fixes within days. It’s reduced our exposure time for zero-day exploits by 75% to 80% and lowers the risk of revenue or service impact to our customers.”

  • The executive director of decisioning at a financial services company said: “It’s a very rare instance when the cloud is down, so customer-facing applications are definitely more stable now. Pega is doing a good job of getting the latest patches in and ensure our customers don’t experience issues.”

  • The executive director added: “We schedule upgrades during low-traffic periods like Saturdays and Sundays to reduce potential impact on customers. Most clients avoid using a mirror environment because it’s expensive, and Pega Cloud’s upgrade process helps prevent disruption for customer-facing apps without requiring that additional production environment.”

  • The executive director concluded: “We have credit cards, checking accounts, investment accounts, and even nonacquisition interactions. Even though some don’t immediately generate revenue, they engage customers, build loyalty, and eventually drive revenue. Pega Cloud ensures these customer-facing applications remain available, which protects both direct and indirect revenue streams.”

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

  • In the prior environment, the composite experienced four customer-facing downtime events per year, each lasting 6 hours.

  • The average revenue loss per hour of downtime during peak hours for customer-facing applications built on Pega solutions is $57,078. This figure is derived from the organization’s $5 billion annual revenue, the 10% share attributable to customer-facing applications built on Pega solutions, and a modeling assumption that revenue impact is distributed evenly across the year’s 8,760 hours. This approach provides a conservative estimate for hourly revenue loss during downtime.

  • With Pega Cloud, the composite reduces downtime events by 60% in Year 1, 65% in Year 2, and 70% in Year 3. It shortens downtime duration per incident by 70% in Year 1, 75% in Year 2, and 80% in Year 3.

  • The composite’s operating margin is 10%.

Risks. This benefit will vary among organizations based on:

  • Average customer-facing downtime events per year in the prior environment.

  • Revenue loss per hour of downtime during peak hours.

  • Average downtime duration per event in the prior environment.

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 $132,000.

70%

Reduction in customer-facing downtime events with Pega Cloud by Year 3

“Typically, platform patches or maintenance updates happen every month to month and a half and urgent hot fixes can be applied within days. The key benefit is zero downtime — Pega’s operations team handles these updates so that public-facing apps don’t experience outages.”

CIO, government

Improved Business Continuity Due To Reduced Customer-Facing Downtime
Ref. Metric Source Year 1 Year 2 Year 3
F1 Average customer-facing downtime events per year in the prior environment Composite 4 4 4
F2 Revenue loss per 1 hour of downtime of customer-facing applications built on Pega solutions Composite $57,078 $57,078 $57,078
F3 Reduction in customer-facing downtime events with Pega Cloud Interviews 60% 65% 70%
F4 Average customer-facing downtime events per year avoided with Pega Cloud (rounded) F1*F3 2.4 2.6 2.8
F5 Average customer-facing downtime duration per event in the prior environment (hours) Composite 6 6 6
F6 Reduction in downtime duration per event with Pega Cloud Interviews 70% 75% 80%
F7 Downtime duration per event reclaimed with Pega Cloud (hours rounded) F5*F6 4.2 4.5 4.8
F8 Subtotal: Additional uptime with Pega Cloud (hours rounded) F4*F7 10.1 11.7 13.4
F9 Revenue recaptured with Pega Cloud F2*F8 $576,488 $667,813 $764,845
F10 Operating margin D8 10% 10% 10%
Ft Improved business continuity due to reduced customer-facing downtime F9*F10 $57,649 $66,781 $76,485
  Risk adjustment 20%      
Ftr Improved business continuity due to reduced customer-facing downtime (risk-adjusted)   $46,119 $53,425 $61,188
Three-year total: $160,732 Three-year present value: $132,051
Unquantified Benefits

Interviewees highlighted that the Pega-as-a-service offering with Pega Cloud provides both foundational platform-level capabilities and application-level outcomes that their organizations realized once they migrated their Pega applications. The platform-level benefits underpinned operational efficiency, compliance, and scalability, while application-level benefits were realized at the workflow and process level to drive customer engagement, process optimization, and business growth. The following benefits were recognized by interviewees but were not quantified in the financial model:

Platform-level benefits. By eliminating infrastructure constraints and automating core operational tasks, Pega Cloud provided foundational capabilities that interviewees said were critical to achieving scalability, compliance, and operational efficiency:

  • Accelerated organizational growth. Interviewees highlighted that Pega Cloud streamlined the onboarding of new business units through rapid environment provisioning and reuse of security, compliance, and integration work already completed, which shortened time to value for new initiatives and avoided duplicating effort.
    The CIO at the government organization explained: “When we think about new adoption, the biggest advantage is that other parts of the organization can take advantage of the groundwork we’ve already done. They don’t have to reinvent the wheel; they can reuse security, compliance, and integration work and move forward much faster. Whether they were on-prem before or brand new, they can leverage what’s in place and speed up deployment. That’s something we couldn’t have done without Pega Cloud.”

“I would say the good thing with Pega Cloud is that we are able to expand our operations without worrying about infrastructure limits and without scaling our application manually; it scales by itself. We don’t have to think about hardware or capacity planning anymore. That flexibility has been critical as we grow.”

VP, IT, healthcare

  • Improved compliance and audit readiness. Interviewees noted that their organizations benefited from built-in compliance frameworks, automated patching, and audit trails that reduced risk and accelerated regulatory and security authorizations that were required to operate applications or systems in accordance with laws, industry standards, and organizational security policies. Their teams avoided the manual, error-prone processes that previously consumed weeks of effort.
    The CIO in government shared: “Pega Cloud maintains FedRAMP [Federal Risk and Authorization Management Program], HIPAA, and FISMA [Federal Information Security Modernization Act] controls, and because of the platform, we can reuse ATO approvals. Before, an ATO process could take 12 to 16 weeks with hundreds of hours of documentation and testing. Now, because Pega Cloud inherits security controls, we reuse approvals and cut that time by 75% to 80%. What used to take months now takes a few weeks. Even audit readiness is easier because controls are inherited, patching is automated, and vulnerability scans are built in.”
    For the healthcare VP of IT, compliance improvements were tied to HIPAA and audit readiness: “With Pega Cloud, intake is automated, verification is tracked, and everything is logged; who did it, when, and whether it was the right person. We no longer see noncompliance risk, and audits are much smoother.”

  • Enhanced access to government markets. For interviewees’ organizations that provide cloud services to US federal agencies — or operate in sectors where handling federal data is required — FedRAMP compliance through Pega Cloud was essential to meet strict security and data protection standards. Migrating Pega applications to a FedRAMP-authorized Pega Cloud instance enabled interviewees’ organizations to pursue opportunities in regulated markets while consolidating environments and reducing duplicated security work across multiple groups.
    The CIO at the government organization explained: “Moving our Pega applications to a single FedRAMP-compliant Pega Cloud instance helped us consolidate multiple on-prem groups and eliminate duplicated patching and maintenance efforts across 15 to 20 groups. Before, we had to replicate those activities across all those groups.”

  • Improved employee experience. Interviewees explained that Pega Cloud’s automation of infrastructure, zero-downtime upgrades, and low-code configuration eliminated weekend outages and repetitive manual tasks, which improved job satisfaction and freed teams up to focus on higher-value work.
    The senior IT lead in financial services said: “When our Pega apps were on-prem, monthly upgrades meant weekend outages and late nights. Every deployment carried risk. Now, automation and low-code have freed up time for higher-value work. Teams aren’t firefighting and working through the night, they’re innovating. They’re much happier now.”

Application-level benefits. For the interviewees’ organizations, migrating applications to Pega Cloud unlocked workflow and business-process improvements that extended beyond platform capabilities. Interviewees highlighted several operational and business outcomes that were not quantified in the financial model:

  • Enhanced customer experience. Pega Cloud enabled faster resolution of inquiries and more consistent service across the interviewees’ organizations’ channels by leveraging near-zero-downtime upgrades, automated patching, and elastic scalability. These capabilities allowed the healthcare organization to reduce manual processes by 80%, with response times dropping from a range of two to three days to 5 to 20 minutes — improvements that would have been slower and riskier to achieve in a legacy on-prem environment.
    Interviewees emphasized that Pega Cloud’s automation and high availability drove these improvements because these features ensured agents had real-time access to data and eliminated delays caused by manual processes. The VP of IT explained these features also enabled omnichannel support and consistent service across channels — outcomes that were previously hindered by downtime and manual updates: “What we have seen on the business side is that there is omnichannel support and consistent service across all channels, which improved our customer satisfaction and engagement. Earlier, customers would call for some information, and we’d take it down and call back days later. Now, most things are resolved in the first call because agents have everything they need. Our intake process became much smoother and better than before. For existing customers, whether it’s a billing issue or any other issue, we are able to help them quickly.”

  • Optimized revenue and sales. Interviewees explained that hosting their Pega customer service and sales applications on Pega Cloud allowed them to capture revenue opportunities faster and improve sales conversion because automated patching, zero-downtime updates, and proactive monitoring ensured uninterrupted availability and rapid rollout of enhancements. These capabilities reduced delays and errors that previously caused missed opportunities in the on-prem environment.
    The VP of IT at a healthcare organization attributed revenue growth to streamlined workflows and faster approvals enabled by Pega Cloud’s automation and high availability. Prior to migration, intake and verification were manual, taking two to three days and causing missed referrals. After migrating, approvals were near real time, response times dropped to minutes, and their organization converted more patients without adding staff. These operational gains — not just improved uptime — drove higher conversion rates and accelerated revenue growth from 8% annually to 10% to 12%.
    The VP of IT in healthcare noted: “Before, the first call would be 15 minutes just capturing the information and then a back-end team would research and provide details to the representative, who would then call the customer back. It was taking two to three days before we could respond, and some customers were not happy with that. We may have lost a lot of sales because of that in the past.”
    The VP of IT concluded: “We no longer missed referrals because approvals were faster. That meant more patients converted and our revenue has grown because our workflows are more seamless.”

  • Accelerated rapid prototyping and development. Using Pega Blueprint on Pega Cloud enabled the interviewees’ organizations to accelerate application development through iterative prototyping and fast feedback loops in a centralized, cloud-managed environment. Teams could collaborate simultaneously, test ideas, and refine applications quickly without the infrastructure constraints and manual setup required on-prem.
    The senior IT lead in financial services shared: “With Pega, you basically have a rapid prototype model where you can just click in a couple of screens or create a couple of screens in a day. It’s really fast and gets quick feedback instead of creating a picture or doing it in words. We can just create a screen and talk about it.”
    The senior IT lead continued: “At any given time, we have 10 or 20 people using Blueprint, and that’s continuous. We use it in a lot of domains. Every time we start a greenfield or new application, we start with Blueprint to rapidly build and refine applications. It’s change something, generate new screens, iterate quickly — that’s our rapid prototyping.”

 Interview Spotlight

A Financial Services Organization Improves Customer Engagement To Grow The Topline With Pega Cloud

Use case. A financial services organization that deployed the Customer Decision Hub on Pega Cloud to power 5 billion omnichannel decisions. 

Business objective. According to the executive director of decisioning, the organization sought to leverage Pega’s strong modeling capabilities to create a centralized location for the audience that would improve engagement with customers across touchpoints.

Result. The executive director of decisioning at this organization described the prior system limitations in terms of capabilities that restricted their ability to meet customer expectations around engagement before deploying Customer Decision Hub (CDH) on Pega Cloud: “It was very important to improve the engagement that we had with our customers at different touch points. However, the prior system was really outdated [and] one of the older tools was just not up to the market standard anymore. We were looking to see if we could bring in newer capabilities that didn’t exist with the prior product to improve [customer engagement].” By hosting CDH on Pega Cloud, the interviewee’s organization accelerated these outcomes through elastic scalability, zero-downtime upgrades, and automated patching — capabilities that ensured uninterrupted decisioning and rapid rollout of enhancements without the infrastructure constraints and manual effort required on-prem. The executive director emphasized the business impact: “On top of all the high-revenue products that we have, we also have a lot of nonacquisition conversations that — even though they don’t always have the biggest value in terms of revenue generation — still have quite a bit of influence on the customer loyalty and the love and usage of our products. So, eventually, even [those touchpoints] turn into money for us.” 

“The prior product that we had was very limited in its capabilities. The solution was only connected to the digital channels, and you couldn’t really do much more with it. We wanted to do something omnichannel and bring in modeling capabilities that Pega has that are strong. Additionally, from an execution perspective [with Pega], we could leverage the capabilities of reusability to have one centralized place where you could have audience go in and be managed as like almost like an air traffic controller.”

Executive director, decisioning, financial services

Flexibility

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

  • Empowering new solution innovation with the Pega-as-a-service experience on Pega Cloud. Interviewees described their plans for expanding usage of Pega to new applications, noting that they aim to leverage advanced capabilities such as GenAI-assisted workflow automation, Pega Blueprint for rapid workflow and case design, and automated documentation of case stages and rules. By building on the core cloud environment, teams anticipate accelerated time-to-value, reduced errors, and the ability to adapt quickly to changing business needs.
    The CIO at the government organization explained: “With Pega, we can start with a core application and then expand to other areas as needs evolve. [Pega] Blueprint and GenAI let us rapidly prototype new workflows; we can try something, see how it works, get feedback from the team, and adjust right away. And when we’re ready, we can bring additional apps online without starting from scratch. That means we see the value much earlier in the process, and it helps get buy-in from stakeholders because they can actually see what we’re building. It’s not just theoretical; it’s tangible. That has really changed the way we approach new initiatives, and it’s something we keep coming back to as we plan future projects.”

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

Analysis Of Costs

Quantified cost data as applied to the composite
Total Costs
Ref. Cost Initial Year 1 Year 2 Year 3 Total Present Value
Gtr Fees to Pega $252,000 $483,000 $700,875 $924,000 $2,359,875 $1,964,541
Htr Implementation costs $417,164 $406,164 $395,164 $384,164 $1,602,656 $1,401,614
Itr Ongoing costs $24,024 $114,400 $114,400 $114,400 $367,224 $308,520
  Total costs (risk-adjusted) $693,188 $1,003,564 $1,210,439 $1,422,564 $4,329,755 $3,674,675
Fees To Pega

Evidence and data. Interviewees described subscription costs for Pega Cloud, noting that fees were based on the number of applications hosted and the case volume per application annually. The subscription included entitlements for:

  • Pega Platform

  • Pega GenAI platform package plus Pega GenAI Autopilot.

  • Pega Agile Studio for software development project management,

The subscription also included the following cloud services:

  • One production environment and two sandboxes (large and standard).

  • Production data storage and cloud file storage.

  • Pega Deployment Manager Service for DevOps pipeline automation.

  • Pega Diagnostic Center (PDC) for application health monitoring.

Interviewees highlighted that the subscription provided a comprehensive bundle of platform capabilities, cloud services, and monitoring tools, which enabled efficient management of applications on Pega Cloud.

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

  • The composite migrates five apps to Pega Cloud initially then 10 by Year 1, 15 by Year 2, and 20 by Year 3.

  • Each app processes 50,000 cases annually, resulting in cumulative case volumes of 250,000 initially, 500,000 in Year 1, 750,000 in Year 2, and 1 million by the end of Year 3.

  • The cost per case decreases over time based on Pega’s pricing structure. It is $0.96 initially, $0.92 in Year 1, $0.89 in Year 2, and $0.88 in Year 3.

  • Pricing may vary. Contact Pega for details.

Risks. This cost will vary among organizations based on:

  • Number of Pega apps migrated to Pega Cloud.

  • Average cases processed per app annually.

  • Cost Pega charges per case.

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 $2.0 million.

Fees To Pega
Ref. Metric Source Initial Year 1 Year 2 Year 3
G1 Pega apps migrated to Pega Cloud B1 5 10 15 20
G2 Cases per app Composite 50,000 50,000 50,000 50,000
G3 Cumulative cases G1*G2 250,000 500,000 750,000 1,000,000
G4 Cost per case Pega $0.96 $0.92 $0.89 $0.88
Gt Fees to Pega G3*G4 $240,000 $460,000 $667,500 $880,000
  Risk adjustment 5%        
Gtr Fees to Pega (risk-adjusted)   $252,000 $483,000 $700,875 $924,000
Three-year total: $2,359,875 Three-year present value: $1,964,541
Implementation Costs

Evidence and data. Interviewees described costs associated with migrating Pega apps onto Pega Cloud, which included third-party professional services and internal resource time. While the Pega Cloud subscription covered platform maintenance and upgrades, the interviewees’ organizations incurred additional costs for consulting and integration support during the initial implementation phase — typically spanning several months — and for ongoing advisory needs as additional applications were migrated in subsequent years. Interviewees noted that internal IT and business resources continued to dedicate a consistent level of time to implementation activities each year as new Pega applications were migrated. The majority of the migration costs were spent on updating older applications to support Pega best practices and ensuring they were cloud-ready while also updating internal client systems to support native cloud integrations.

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

  • The composite incurs third-party professional services fees for app migration, integration, and implementation, starting at $100,000 then decreasing to $90,000 in Year 1, $80,000 in Year 2, and $70,000 in Year 3. Third-party professional services fees decrease over time as initial migration and integration work is more complex and resource intensive. Subsequent migrations benefit from established processes and internal knowledge transfer.

  • Six IT resources are involved in implementation, dedicating 50% of their time during each year. The average fully burdened annual salary for an IT resource is $72,800.

  • Three business users participate in implementation, dedicating 25% of their time. The average fully burdened annual salary for a business user is $81,120.

Risks. This cost will vary among organizations based on:

  • Complexity of migrating applications to Pega Cloud, including multiregion deployments and advanced configurations.

  • Degree of customization and integration with existing systems, which can increase migration effort.

  • Extent to which internal teams require third-party support versus leveraging internal expertise for migration and integration.

Results. To account for these risks, Forrester adjusted this cost upward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $1.4 million.

Implementation Costs
Ref. Metric Source Initial Year 1 Year 2 Year 3
H1 Third-party professional services fees for app migration, integration, and implementation Composite $100,000 $90,000 $80,000 $70,000
H2 IT resources involved in implementation Composite 6 6 6 6
H3 Average percentage of IT resource time spent on implementation Interviews 50% 50% 50% 50%
H4 Average fully burdened annual salary for an IT resource Composite $72,800 $72,800 $72,800 $72,800
H5 Business users involved in implementation Interviews 3 3 3 3
H6 Average percentage of business user time spent on implementation Interviews 25% 25% 25% 25%
H7 Average fully burdened annual salary for a business user Composite $81,120 $81,120 $81,120 $81,120
Ht Implementation costs H1+((H2*H3*H4)+(H5*H6*H7)) $379,240 $369,240 $359,240 $349,240
  Risk adjustment ↑10%        
Htr Implementation costs (risk-adjusted)   $417,164 $406,164 $395,164 $384,164
Three-year total: $1,602,656 Three-year present value: $1,401,614
Ongoing Costs

Evidence and data. Interviewees described ongoing costs tied to managing Pega Cloud after initial implementation. While Pega Cloud handled platform maintenance and upgrades, internal teams dedicated time to governance, configuration changes, and vendor coordination. These activities included evaluating business requests, validating feasibility, and ensuring best practices to avoid unnecessary customization. Interviewees highlighted three main areas of effort:

  • Configuration and workflow changes. Interviewees said their IT teams spent time working with business users to review requests, assess feasibility, and implement approved changes. The VP of IT at a healthcare organization explained: “We have seven or eight people who are spending between 25% and 50% of their time are working with users on the workflow changes or configurations they want. It’s more like brainstorming; what makes sense, what doesn’t. Once it’s understood and approved, then we make those configuration changes.”

  • Governance and best practices. Interviewees emphasized the importance of avoiding excessive customization and relying on Pega guidance. The VP of IT at a healthcare organization noted: “My general direction is, if it’s out of the box, we don’t want to over customize because then it kills the value. We only go to Pega after internal due diligence and when something is really needed for business or compliance reasons.”

  • Vendor management. Interviewees reported regular meetings with the Pega team to discuss platform-related topics such as issue resolution, roadmap updates, and best practices. These sessions often included business stakeholders to ensure alignment and get direct insight and guidance from Pega.
    The VP of IT at a healthcare organization shared: “We have biweekly or monthly meetings with Pega. These are multipurpose, discussing issues, roadmap updates, and best practices. Sometimes we pull in business teams so they can hear directly from Pega how other customers are solving similar problems.”

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

  • Four IT resources are involved in ongoing management starting in Year 1, dedicating 25% of their time annually. The average fully burdened annual salary for an IT resource is $72,800.

  • One business user participates in ongoing management starting in Year 1, dedicating 25% of their time annually. The average fully burdened annual salary for a business user is $81,120.

  • Three IT resources handle vendor management across all years, dedicating 10% of their time during the initial period and 5% in Years 1, 2, and 3.

Risks. This cost will vary among organizations based on:

  • Complexity of the Pega Cloud environment (e.g., multiregion deployments, advanced configurations).

  • Governance and compliance requirements that increase monitoring and reporting needs.

  • Level of customization and frequency of platform updates requiring validation and testing.

  • Vendor management intensity, including SLA tracking and coordination with Pega support.

Results. To account for these risks, Forrester adjusted this cost upward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $309,000.

Ongoing Costs
Ref. Metric Source Initial Year 1 Year 2 Year 3
I1 IT resources involved in ongoing management Composite 4 4 4 4
I2 Average percentage of internal resource time spent on ongoing management Interviews 0% 25% 25% 25%
I3 Average fully burdened annual salary for an IT resource H4 $72,800 $72,800 $72,800 $72,800
I4 Business users involved in ongoing management Composite 1 1 1 1
I5 Average percentage of business user time spent on ongoing management Interviews 0% 25% 25% 25%
I6 Average fully burdened annual salary for a business user H7 $81,120 $81,120 $81,120 $81,120
I7 Subtotal: Professional services and ongoing management costs (I1*I2*I3)+(I4*I5*I6)) $0 $93,080 $93,080 $93,080
I8 IT resources involved in vendor management Composite 3 3 3 3
I9 Average percent of time spent on vendor management Interviews 10% 5% 5% 5%
I10 Average fully burdened annual salary for an IT resource H4 $72,800 $72,800 $72,800 $72,800
I11 Subtotal: Vendor management I8*I9*I10 $21,840 $10,920 $10,920 $10,920
It Ongoing costs I7+I11 $21,840 $104,000 $104,000 $104,000
  Risk adjustment ↑10%        
Itr Ongoing costs (risk-adjusted)   $24,024 $114,400 $114,400 $114,400
Three-year total: $367,224 Three-year present value: $308,520

Financial Summary

Consolidated Three-Year, Risk-Adjusted Metrics

Cash Flow Chart (Risk-Adjusted)

[CHART DIV CONTAINER]
Total costs Total benefits Cumulative net benefits Initial Year 1 Year 2 Year 3
Cash Flow Analysis (Risk-Adjusted)
  Initial Year 1 Year 2 Year 3 Total Present Value
Total costs ($693,188) ($1,003,564) ($1,210,439) ($1,422,564) ($4,329,755) ($3,674,675)
Total benefits $0 $2,187,881 $2,508,562 $2,962,353 $7,658,796 $6,287,835
Net benefits ($693,188) $1,184,317 $1,298,123 $1,539,789 $3,329,041 $2,613,160
ROI           71%
Payback           8 months

 Please Note

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 Cloud.

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 Cloud can have on an organization.

Due Diligence

Interviewed Pega stakeholders and Forrester analysts to gather data relative to Pega Cloud.

Interviews

Interviewed four decision-makers at organizations using Pega Cloud to obtain data about costs, benefits, and risks.

Composite Organization

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

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.

Case Study

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.

Total Economic Impact Approach
Benefits

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

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

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

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.”

Financial Terminology
Present value (PV)

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.

Net present value (NPV)

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.

Return on investment (ROI)

A project’s expected return in percentage terms. ROI is calculated by dividing net benefits (benefits less costs) by costs.

Discount rate

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%.

Payback

The breakeven point for an investment. This is the point in time at which net benefits (benefits minus costs) equal initial investment or cost.

Appendix A

Total Economic Impact

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.

Appendix B

Supplemental Material

Related Forrester Research

“The Total Economic Impact™ Of Pega Customer Service,” a commissioned study conducted by Forrester Consulting on behalf of Pega, January 2026.

“The Total Economic Impact™ Of Pega Customer Decision Hub,” a commissioned study conducted by Forrester Consulting on behalf of Pega, January 2025.

Appendix C

Endnotes

1 Source: Best Practices For Software-As-A-Service Operations, Forrester Research, Inc., March 20, 2025.

2 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.

Disclosures

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 Cloud.

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.

Consulting Team:

Zahra Azzaoui

Published

January 2026