Executive Summary
Industrial organizations operate in data-rich, asset-intensive environments, yet much of this data remains fragmented across multiple systems and lacks the context required for effective decision-making. As a result, organizations are often described as “data-rich but insight-poor,” frequently relying on manual processes to access and interpret information. By unlocking more integrated, contextualized, and accessible data, organizations can be better positioned to improve operational performance, safety, and efficiency.
Falkor is an industrial intelligence platform designed to aggregate and contextualize data from multiple systems within a unified environment. It builds on a digital twin foundation and incorporates simulation and artificial intelligence (AI) capabilities. The platform provides users across operations, maintenance, and engineering functions with access to current and historical data, supporting collaboration, planning, and execution of work.
Falkor (formerly known as Kongsberg Digital) commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realize by deploying its industrial intelligence platform.1 The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Falkor on their organizations.
To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed four decision-makers with experience using Falkor. 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 large energy enterprise with complex operations.
Interviewees said that prior to using Falkor, their organizations operated in fragmented environments with data spread across numerous systems, requiring manual effort to retrieve and reconcile information. This approach resulted in inefficiencies, limited visibility, and challenges in accessing accurate, timely data for decision-making.
Interviewees said that after investing in Falkor, their organizations shifted to a more integrated and data-driven operating model. Users gained the ability to access a single contextualized view of asset information, which enabled faster troubleshooting, improved planning, and led to more effective collaboration across teams. Key results included reduced downtime, improved labor productivity, and the opportunity to rationalize legacy IT systems.
Key Findings
Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:
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Downtime reductions worth $74.9 million. Falkor helps the composite organization reduce downtime by improving troubleshooting speed and incident response time. Centralized access to asset data and remote collaboration capabilities allow its teams to resolve issues more quickly, reducing time to resolution by 50%. This enables faster diagnosis of issues and more timely planning of corrective actions, lowering the financial impact of both planned and unplanned downtime.
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Labor cost savings of $21.7 million. Falkor helps the composite organization improve its workforce productivity by reducing the need for physical site visits and enabling faster access to information. Centralized access to data allow employees to spend less time on maintenance walks and manual data searches, freeing time for higher-value activities such as analysis, decision-making, and critical maintenance tasks.
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Savings of $11.3 million due to retiring legacy IT systems. Consolidating capabilities from multiple tools into a single platform allows the composite organization to simplify its IT landscape. This reduces its reliance on legacy systems and lowers associated licensing and maintenance costs as adoption scales across sites.
Unquantified benefits. Benefits that provide value for the composite organization but are not quantified for this study include:
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More effective collaboration and enablement of remote work. Falkor reduces the composite organization’s reliance on in-person interactions and improves coordination by enabling its cross-functional and geographically distributed teams to collaborate in real time using shared asset data and visualizations.
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Safer operations and improved workforce experience. By reducing the need for physical presence onsite, Falkor lowers the composite organization’s exposure to hazardous environments and supports safer planning and execution of maintenance activities.
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Improved searchability and access to asset information. Falkor reduces the time employees at the composite organization spend searching for information by providing a central interface to locate engineering documents and operational data.
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Support for broader digital transformation and organizational alignment. Falkor helps the composite organization advance its digital transformation initiatives by making integrated data and analytics more accessible and actionable for business users.
Costs. Three-year, risk-adjusted PV costs for the composite organization include:
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License costs of $13.8 million. The composite organization incurs recurring licensing costs on a per-site basis, increasing as adoption scales from one site in Year 1 to 10 sites in Year 3.
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Implementation and ongoing management costs of $8.5 million. The composite organization incurs costs for internal labor, deployment services, and ongoing support to implement and operate Falkor across multiple sites. These costs include change management and user enablement activities required to support adoption.
The financial analysis that is based on the interviews found that a composite organization experiences benefits of $107.9 million over three years versus costs of $22.3 million, adding up to a net present value (NPV) of $85.6 million and an ROI of 384%.
Key Statistics
384%
Return on investment (ROI)
$107.9M
Benefits PV
$85.6M
Net present value (NPV)
<6 months
Payback
Benefits (Three-Year)
The Falkor Customer Journey
Drivers leading to Falkor investment
Interviews
| Title | Industry | Region | Annual revenue |
|---|---|---|---|
| Digital twin advisor and technical manager | Oil and gas | Global (Headquarters: US) | $200 billion |
| GM, global digital programs and products | Oil and gas | Global (Headquarters: UK) | $280 billion |
| Information and digital technology manager | Oil and gas | Global (Headquarters: UK) | $280 billion |
| Product owner, digital twin |
Oil and gas |
Canada | $350 million |
Key Challenges
Interviewees said that prior to adopting the solution, their organizations operated in complex, asset-intensive environments in which information was dispersed across multiple legacy systems and tools. These systems were not always designed to work together, requiring users to manually retrieve and reconcile data from different sources. As a result, the organizations struggled to access timely and accurate information, thus limiting operational efficiency and decision-making effectiveness.
Interviewees noted how their organizations struggled with common challenges, including:
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Fragmented systems and lack of a single source of truth. Interviewees’ organizations relied on 20 or more disparate systems (e.g., maintenance, inspection, and document management tools) with no unified interface to access critical asset data. This required users to log into multiple platforms and manually piece together information, which interviewees said resulted in slow information retrieval, limited situational awareness, and an increased risk of making mistakes. In some cases, gathering the required information for a task could take several hours.
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Heavy manual effort and inefficient workflows. Interviewees described significant manual intervention in core processes such as maintenance planning, data retrieval, and operational coordination. Employees spent considerable time searching for documents, validating data, and performing physical inspections or job walks, which increased operational costs and the risk of human error. These inefficiencies became more pronounced as asset complexity and data volumes grew.
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Limited value realization due to data quality, context, and trust issues. Interviewees said their organizations struggled with long-standing challenges related to data quality, lineage, and contextualization that often stemmed from decades of legacy operations. Even when data was available, it was difficult to interpret or trust due to inconsistencies and lack of integration. This limited the ability to generate insights, apply advanced analytics, or fully leverage digital twin initiatives beyond basic visualization.
Solution Requirements
The interviewees searched for a solution that could:
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Provide a centralized platform that aggregates data across systems and serves as a single access point for operating and maintaining assets to enable faster and more informed decision-making.
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Deliver strong data contextualization capabilities and integrate diverse data sources into a coherent and usable data layer to support operational workflows and future advanced analytics and AI use cases.
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Provide an open and scalable architecture that could integrate with existing systems, support enterprisewide deployment, and be replicated across assets and geographies.
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:
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Description of composite. The composite is a large, global, asset-intensive energy organization with complex operations. It generates approximately $200 billion in revenue, employs 50,000 people, and has operations that span multiple geographies and production assets. The organization manages 50 complex industrial facilities (e.g., refineries, chemical plants, offshore platforms) where operations, maintenance, and engineering teams rely on large volumes of technical and operational data.
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Deployment characteristics. The composite organization begins its deployment with an initial implementation at a single site, followed by a structured rollout period. As the organization standardizes its approach and expands use cases over time, deployment scales across additional assets, growing to five sites in Year 2 and to 10 sites in Year 3. The rollout includes integration with multiple existing systems and ongoing investment in implementation, change management, and operational support to enable adoption and value realization across geographies.
KEY ASSUMPTIONS
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$200 billion annual revenue
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Energy organization
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Deploys Falkor at one site in Year 1, five sites in Year 2, and 10 sites in 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 | Cost savings from reduced downtime | $5,967,000 | $29,835,000 | $59,670,000 | $95,472,000 | $74,912,524 |
| Btr | Labor cost savings | $1,728,900 | $8,644,500 | $17,289,000 | $27,662,400 | $21,705,424 |
| Ctr | Reduced costs due to retiring legacy IT systems | $900,000 | $4,500,000 | $9,000,000 | $14,400,000 | $11,299,023 |
| Total benefits (risk-adjusted) | $8,595,900 | $42,979,500 | $85,959,000 | $137,534,400 | $107,916,971 |
Cost Savings From Reduced Downtime
Evidence and data. Interviewees highlighted that Falkor reduced downtime primarily by enabling faster troubleshooting, improving collaboration, and providing the ability to plan responses to incidents before accessing physical sites.
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Interviewees reported that Falkor enabled faster recovery from unplanned shutdowns. One noted that for certain incidents, their organization brought a plant back online approximately 12 hours faster than it could have previously. This is the equivalent of about half a shift of saved downtime.
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Interviewees said a key capability of Falkor is supporting real-time remote troubleshooting and response planning across geographically distributed teams. During live incidents, operations staff, engineers, and external experts have access to a shared, contextualized view of the asset that includes 3D models, engineering drawings, and operational data. Interviewees explained that this allows teams to identify likely failure points, assess affected equipment, and begin planning corrective actions before personnel are able to physically access the site. They also emphasized that this capability eliminates delays associated with waiting for onsite inspections and reduces reliance on sequential, manual information gathering across multiple systems, significantly accelerating time to resolution.
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One interviewee spoke of a production incident in which Falkor enabled remote collaboration between site teams and offsite experts, allowing stakeholders to diagnose the issue and plan remediation steps in parallel. They said that by leveraging the shared visualization and integrated data, their organization’s teams were able to estimate the scope of required work (e.g., impacted equipment and materials) and mobilize resources in advance of site access. This resulted in approximately 12 hours of reduced downtime that the interviewee estimated corresponded to around $2 million in avoided losses for that event.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
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The composite organization operates Falkor at one site in Year 1, five sites in Year 2, and 10 sites in Year 3.
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The average cost per hour of downtime for each site is $170,000.
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Improved data accessibility, visualization, and remote collaboration capabilities reduce the composite’s time to resolution by 50%.
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Only a portion of avoided downtime translates into financial benefit, reflected by a 12% operating margin to isolate profit impact.
Risks. The value of reduced downtime may vary depending on several factors:
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Variation in downtime cost per hour, which depends on asset type, production value, and geography.
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Differences in adoption maturity, which may limit the extent to which an organization leverages advanced troubleshooting and collaboration features.
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The consistency, frequency, and severity of downtime events, which can materially affect realized savings year to year.
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 $74.9 million.
50%
Reduction in time to resolution during downtime event
Cost Savings From Reduced Downtime
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| A1 | Sites | Composite | 1 | 5 | 10 | |
| A2 | Cost per hour of downtime | Interviews | $170,000 | $170,000 | $170,000 | |
| A3 | Downtime before Falkor (hours) | Interviews | 650 | 650 | 650 | |
| A4 | Reduction in time to resolution with Falkor | Interviews | 50% | 50% | 50% | |
| A5 | Operating margin | Composite | 12% | 12% | 12% | |
| At | Cost savings from reduced downtime | A1*A2*A3*A4*A5 | $6,630,000 | $33,150,000 | $66,300,000 | |
| Risk adjustment | ↓10% | |||||
| Atr | Cost savings from reduced downtime (risk-adjusted) | $5,967,000 | $29,835,000 | $59,670,000 | ||
| Three-year total: $95,472,000 | Three-year present value: $74,912,524 | |||||
Labor Cost Savings
Evidence and data. Interviewees said using Falkor led to significant labor efficiency gains driven by a reduced need for physical site visits, faster access to information, and improved planning.
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A recurring benefit mentioned across interviews was a reduction in physical maintenance walks and site visits because teams could remotely access asset information, visualize equipment, and plan work in advance. Interviewees also noted that Falkor substantially reduced time spent traveling to and inspecting assets.
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Interviewees consistently emphasized that Falkor helped substantially reduce the time needed to search for information. One interviewee said Falkor combined tasks that previously required navigating multiple systems and documents into a single interface. They estimated that activities that previously took several hours now take minutes due to centralized access to contextualized data.
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Interviewees frequently said that improving planning and diagnostics workflows were a major contributor to efficiency gains. One mentioned that teams at their organization generate work plans and engineering work orders significantly faster and with up to 50% less effort because all relevant data, drawings, and operational context are in one place.
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Interviewees also highlighted that remote access and centralized visibility allow internal teams and external stakeholders to collaborate without requiring travel or sequential information gathering, which reduced redundant effort across teams. This enabled personnel to shift time from manually gathering data and conducting site inspections to higher-value analysis and decision-making activities.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
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Prior to implementing Falkor, the composite organization had two operators per site perform maintenance walks, inspections, and diagnostic activities for 4 hours each day, amounting to 160 hours monthly.
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Falkor reduces the composite’s need for maintenance walks by 50%.
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Prior to implementing Falkor, operators, technicians, and engineers at the composite organization spent 15 hours per month searching for data and information.
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Falkor reduces the time these employees spend searching for data and information by 60%.
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These efficiency gains translate into monthly labor hour savings across all sites, scaled with adoption from one site to 10 sites over a three-year period.
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The average fully burdened monthly salary for an affected employee is $11,300.
Risks. The value of labor cost savings may vary depending on several factors:
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Variation in workforce structure and labor costs, which may affect the financial value of time savings.
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Differences in user adoption and proficiency, which can influence the extent to which employees shift from traditional workflows to Falkor.
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 $21.7 million.
60%
Time spent searching for data
Labor Cost Savings
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| B1 | Monthly time spent on maintenance walks before Falkor (hours) | Composite | 160 | 160 | 160 | |
| B2 | Sites | Composite | 1 | 5 | 10 | |
| B3 | Reduction in maintenance walks with Falkor | Interviews | 50% | 50% | 50% | |
| B4 | Subtotal: Monthly labor time savings for maintenance walks/diagnostics | B1*B2*B3 | 80 | 400 | 800 | |
| B5 | Monthly time spent searching data before Falkor (hours) | Composite | 150 | 150 | 150 | |
| B6 | Reduction in time spent searching for data with Falkor | Interviews | 60% | 60% | 60% | |
| B7 | Sites | Composite | 1 | 5 | 10 | |
| B8 | Subtotal: Monthly labor time savings searching for data (hours) | B5*B6*B7 | 90 | 450 | 900 | |
| B9 | Total monthly labor time saved (hours) | B4+B8 | 170 | 850 | 1,700 | |
| B10 | Fully burdened monthly salary for an affected employee | Composite | $11,300 | $11,300 | $11,300 | |
| Bt | Labor cost savings | B9*B10 | $1,921,000 | $9,605,000 | $19,210,000 | |
| Risk adjustment | ↓10% | |||||
| Btr | Labor cost savings (risk-adjusted) | $1,728,900 | $8,644,500 | $17,289,000 | ||
| Three-year total: $27,662,400 | Three-year present value: $21,705,424 | |||||
Reduced Costs Due To Retiring Legacy IT Systems
Evidence and data. Interviewees said consolidating multiple legacy tools into Falkor enabled their organizations to simplify their IT landscapes and reduced ongoing software licensing and maintenance costs.
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Interviewees described Falkor as increasingly overlapping with and consolidating capabilities from existing systems, particularly asset information management, data access tools, and visualization tools. As a result, several noted that their organization is actively trying to rationalize its IT landscape and reduce reliance on legacy solutions, with Falkor serving as a central system of reference that often integrates data from more than 20 source systems.
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One interviewee explained that their organization was in the process of retiring a legacy asset information management platform and that Falkor provides equivalent functionality while also enabling additional capabilities such (e.g., better contextualization and integration of data).
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Another interviewee said Falkor helped their organization avoid continued reliance and investment in a specialized engineering and visualization software tool.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
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Prior to adopting Falkor, the composite organization maintained multiple legacy IT systems (e.g., asset information management, document management, and visualization tools) at each site.
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Each legacy IT system costs $1 million annually in licensing and maintenance costs.
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The composite expands Falkor use from one site in Year 1 to 10 sites in Year 3, reflecting a phased rollout and gradual decommissioning of legacy systems.
Risks. The value of IT cost savings may vary depending on several factors:
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Delays in retiring legacy systems that could be driven by internal governance, risk management, or dependency on existing processes.
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Partial overlap in functionality in which an organization may retain certain legacy tools for specialized use cases.
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Organizational resistance to consolidation, including user preferences and change management challenges that may slow migration to Falkor.
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 $11.3 million.
Reduced Costs Due To Retiring Legacy IT Systems
| Ref. | Metric | Source | Year 1 | Year 2 | Year 3 | |
|---|---|---|---|---|---|---|
| C1 | Cost per license per site | Interviews | $1,000,000 | $1,000,000 | $1,000,000 | |
| C2 | Sites | Composite | 1 | 5 | 10 | |
| Ct | Reduced costs due to retiring legacy IT systems | C1*C2 | $1,000,000 | $5,000,000 | $10,000,000 | |
| Risk adjustment | ↓10% | |||||
| Ctr | Reduced costs due to retiring legacy IT systems (risk-adjusted) | $900,000 | $4,500,000 | $9,000,000 | ||
| Three-year total: $14,400,000 | Three-year present value: $11,299,023 | |||||
Unquantified Benefits
Interviewees mentioned the following additional benefits that their organizations experienced but were not able to quantify:
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More effective collaboration and enablement of remote work. Interviewees said Falkor enabled geographically dispersed teams to support onsite teams without being physically present by providing access to shared 3D models, documents, and operational data in a single environment. This improved coordination across operations, maintenance, and engineering teams while accelerating issue resolution and reducing reliance on in-person meetings and site visits. Additionally, interviewees noted that the ability to collaborate remotely with internal teams and external vendors using shared visualizations created more flexible ways of working and broadened participation in operational decision-making.
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Safer operations and improved workforce experience. Interviewees explained that Falkor improved safety by enabling remote planning and reducing the need for physical presence onsite. They highlighted fewer job walks, reduced exposure to hazardous environments, and fewer helicopter trips for offshore assets, all of which lowered health, safety, and environmental (HSE) risks. The ability to plan and visualize work remotely before execution improved preparedness and reduced risk during maintenance activities. In addition, one interviewee noted that remote access capabilities enabled their organization to hire from a broader talent pool by enabling employees to work from larger cities rather than remote asset locations, improving recruitment and retention.
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Improved searchability and access to asset information. Interviewees consistently identified Falkor’s search functionality as a key driver of value and adoption. They described it as a familiar search-style interface for asset data that allows their organizations to quickly locate piping and instrumentation diagrams (P&IDs), engineering drawings, and equipment information that previously required navigating multiple systems. This significantly improved productivity and user experience, and one interviewee noted that tasks that previously took hours to complete now take minutes due to improved data findability.
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Support for broader digital transformation and organizational alignment. Interviewees noted that Falkor plays an important role in helping business stakeholders understand and engage with digital transformation initiatives. They said that by bringing together multiple data sources into a single, visual environment, the platform makes the value of integrated data and real-time insights more tangible, helping to drive adoption of digital ways of working and encouraging further investment in analytics, automation, and AI capabilities.
Flexibility
The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement Falkor and later realize additional uses and business opportunities, including:
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Expanded collaboration with external vendors. One interviewee said Falkor enabled their organization to share asset visualization and contextual data directly with vendors, allowing employees to review equipment remotely rather than traveling onsite. They explained that vendors can review equipment, measurements, and layouts through Falkor instead of traveling onsite, which is particularly valuable for remote or offshore assets. The organizations could expand use of these capabilities over time to reduce travel requirements and accelerate discussions with external partners.
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Evolution into a system of engagement and further IT consolidation. Interviewees outlined a roadmap in which their organizations expand their use of Falkor from a system of reference into a central platform for workflows, orchestration, and operational decision-making. This evolution could enable the organizations to embed more processes directly into the platform, potentially retiring additional legacy systems and simplifying the IT landscape over time.
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 |
|---|---|---|---|---|---|---|---|
| Dtr | License costs | $0 | $1,100,000 | $5,500,000 | $11,000,000 | $17,600,000 | $13,809,917 |
| Etr | Implementation and ongoing management costs | $555,610 | $2,964,940 | $4,634,300 | $1,856,250 | $10,011,100 | $8,475,638 |
| Total costs (risk-adjusted) | $555,610 | $4,064,940 | $10,134,300 | $12,856,250 | $27,611,100 | $22,285,555 |
License Costs
Evidence and data. Interviewees reported their organizations incur recurring license costs for Falkor, typically structured on a per-site basis.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
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The composite organization licenses Falkor on a per-site basis.
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The average annual license fee is $1 million per site per year.
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The composite organization scales deployment over time, beginning with one site in Year 1 and expanding to five sites in Year 2 and 10 sites in Year 3.
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The composite’s licensing costs increase as adoption grows.
Risks. The following risks can potentially impact licensing costs:
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The contract structure.
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The number of deployed assets.
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The level of enterprise standardization.
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Volume discounts and pricing changes over time.
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 $13.8 million.
License Costs
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| D1 | License costs | Interviews | $0 | $1,000,000 | $5,000,000 | $10,000,000 |
| Dt | License costs | D1 | $0 | $1,000,000 | $5,000,000 | $10,000,000 |
| Risk adjustment | ↑10% | |||||
| Dtr | License costs (risk-adjusted) | $0 | $1,100,000 | $5,500,000 | $11,000,000 | |
| Three-year total: $17,600,000 | Three-year present value: $13,809,917 | |||||
Implementation And Ongoing Management Costs
Evidence and data. Interviewees reported that their organizations incurred a mix of internal labor costs related to the initial deployment of Falkor and that there are ongoing costs to manage, extend, and operate the platform over time.
Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:
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The composite organization incurs one-time implementation costs per site for internal labor, deployment services, and supporting activities required to onboard each new asset.
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Implementation requires a dedicated team of six employees per site over a six-month period.
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The composite organization incurs ongoing management costs for platform maintenance, enhancements, change management, and user enablement activities.
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These costs scale over time as deployment expands from 1 site during the initial period to five sites in Year 3.
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Ongoing support requires a team that grows from 10 employees in early stages to 25 employees as adoption scales, with each resource partially allocated to the platform.
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The composite organization incurs additional deployment service fees to support ongoing and configuration activities for each new site.
Risks. The following risks can potentially impact implementation and ongoing management costs:
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Asset complexity, data readiness, and the need for additional activities such as 3D modeling or system integration, which can extend implementation timelines and increase the number of required resources.
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Change management capabilities, user adoption rates, and the need for additional training, communication, and business transformation requirements, which can increase implementation and ongoing management costs.
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Organizational structure, degree of centralization, and platform enhancement pace requirements, including the introduction of new use cases and capabilities, which can increase ongoing management costs.
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 $8.5 million.
Implementation And Ongoing Management Costs
| Ref. | Metric | Source | Initial | Year 1 | Year 2 | Year 3 |
|---|---|---|---|---|---|---|
| E1 | Employees involved in implementation | Interviews | 6 | 6 | 6 | 0 |
| E2 | Time needed for implementation (months) | Interviews | 6 | 6 | 6 | 0 |
| E3 | Fully burdened monthly salary for an employee involved in implementation | Composite | $11,300 | $11,300 | $11,300 | |
| E4 | Percent of time each implementation employee dedicates to Falkor | Interviews | 75% | 75% | 75% | |
| E5 | Deployment service fees | Interviews | $200,000 | $200,000 | $200,000 | $0 |
| E6 | New sites deployed with Falkor | Composite | 1 | 4 | 5 | 0 |
| E7 | Implementation costs | (E1*E2*E3*E4*E6) +(E5*E6) | $505,100 | $2,020,400 | $2,525,500 | $0 |
| E8 | Employees dedicated to ongoing management | Interviews | 0 | 10 | 25 | 25 |
| E9 | Fully burdened annual salary for an employee who conducts ongoing management | Composite | $135,000 | $135,000 | $135,000 | |
| E10 | Percent of time an employee who conducts ongoing management dedicates to Falkor | Interviews | 50% | 50% | 50% | |
| E11 | Ongoing management costs | E8*E9*E10 | $675,000 | $1,687,500 | $1,687,500 | |
| Et | Implementation and ongoing management costs | E7+E11 | $505,100 | $2,695,400 | $4,213,000 | $1,687,500 |
| Risk adjustment | ↑10% | |||||
| Etr | Implementation and ongoing management costs (risk-adjusted) | $555,610 | $2,964,940 | $4,634,300 | $1,856,250 | |
| Three-year total: $10,011,100 | Three-year present value: $8,475,638 | |||||
Financial Summary
Consolidated Three-Year, Risk-Adjusted Metrics
Cash Flow Chart (Risk-Adjusted)
Cash Flow Analysis (Risk-Adjusted)
| Initial | Year 1 | Year 2 | Year 3 | Total | Present Value | |
|---|---|---|---|---|---|---|
| Total costs | ($555,610) | ($4,064,940) | ($10,134,300) | ($12,856,250) | ($27,611,100) | ($22,285,555) |
| Total benefits | $0 | $8,595,900 | $42,979,500 | $85,959,000 | $137,534,400 | $107,916,971 |
| Net benefits | ($555,610) | $4,530,960 | $32,845,200 | $73,102,750 | $109,923,300 | $85,631,416 |
| ROI | 384% | |||||
| Payback | <6 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 Falkor’s industrial intelligence platform.
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 Falkor can have on an organization.
Due Diligence
Interviewed Falkor stakeholders and Forrester analysts to gather data relative to Falkor.
Interviews
Interviewed four decision-makers at organizations using Falkor 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.
Disclosures
Readers should be aware of the following:
This study is commissioned by Falkor 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 Falkor’s industrial intelligence platform. For any interactive functionality, the intent is for the questions to solicit inputs specific to a prospect's business. Forrester believes that this analysis is representative of what companies may achieve with Falkor based on the inputs provided and any assumptions made. Forrester does not endorse Falkor or its offerings. Although great care has been taken to ensure the accuracy and completeness of this model, Falkor and Forrester Research are unable to accept any legal responsibility for any actions taken on the basis of the information contained herein. The interactive tool is provided ‘AS IS,’ and Forrester and Falkor make no warranties of any kind.
Falkor 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.
Falkor provided the customer names for the interviews but did not participate in the interviews.
Consulting Team:
Antonie Bassi
Published
August 2026
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