The Total Economic Impact™ Of Microsoft 365 A5 for K-12 Schools

Reduced License Costs From Vendor Consolidation

Evidence and data. Transitioning from a point-solution integration model to Microsoft 365 A5 helped interviewees’ and survey respondents’ organizations lower licensing costs. They provided the following examples of how these cost reductions were achieved:

• All interviewees cited the ability to consolidate solutions and eliminate costs as a driver to move to Microsoft 365 A5.

• The chief information officer of an alternative high school shared: “Limited budgets are the catch. I can spend my A5 cost, set it, and forget it. Otherwise, I have multiple contracts to renew every school year that will consistently go up in price every year, just because that’s what they do.”

• Beyond the cost savings associated with the move to Microsoft 365 A5, the director of technology at a private school said, “A5 is heavily preferred by the business users.”

• Survey respondents whose organizations reduced external vendor costs cited reductions in a combination of subscription, maintenance, and hardware costs.

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

• Prior to moving to Microsoft 365 A5, the composite organization’s cost for the prior security, compliance, and privacy solutions was 30% higher than the total Microsoft 365 A5 license cost of $117 per employee per year.

• The institution eliminates this cost after implementing Microsoft 365 A5.

• Only 50% of the benefit is realized in Year 1 as some prior solution license agreements expire.

Risks. The following risks impact the size of this benefit:

• The amount of cost elimination is dependent on the prior state of the organization; this amount varied between the interviewees’ institutions.

• Security needs also impacted the alternate solutions that an organization would need if not using Microsoft 365 A5, which introduces variability in this benefit.

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 $76,000.

Strengthened Security

Evidence and data. Interviewees noted that Microsoft 365 A5 included more than 30 security, compliance, and privacy features not included in Microsoft 365 A3. Because they were all from a single vendor, these capabilities offered tight integration and improved the interviewees’ organizations’ security postures in terms of the number and severity of breaches. This improved posture reduced downtime and cost after a cyber event, protected the interviewees’ organizations’ public reputation, and limited the disruption to teaching. Interviewees and survey respondents shared the following examples of how their organizations’ security postures improved:

• The chief information officer at an alternative high school described a recent incident: “We just had a cyber outbreak where I had all the data I wanted to know about it. I knew exactly where it came from, who it hit, where it replicated from, the user that it got to, what we did to respond to that user, and then followed it up with a training that was built right into Purview and compliance. We had the tools we needed.”

• The executive director of technology and innovation said their independent school was the target of a ransomware attack, which led to their implementation of Microsoft 365 A5. The interviewee shared that even though the ransomware event was ultimately handled, it had a significant impact on their organization in terms of the costs of recovery and remediation. They described the impact in the following way: “Our team of 12 spent over 125 hours to remediate immediately following the incident. Over 1,100 users were impacted.” The interviewee noted that with Microsoft 365 A5, their district was better equipped to avoid similar incidents in the future, including the associated impacts to the students as well as the costs of recovery.

• The director of technology at a private school said that it was important that they could demonstrate that “everything is safe, protected, and encrypted as needed,” particularly for sensitive student information.

• The director of information services for a public school district explained that A5 made it easier to enforce policies, thus strengthening their security posture. They stated: “[Enforcing policies] through Intune, where we’re pushing it out to everything comprehensively, you have that consistency that just ups your security profile because you know what you’ve got across the board, [and] you’ve got less exceptions to worry about. Whereas whenever you don’t have that nice controlled, ‘everybody’s covered by one policy’ thing, you’re always wrestling with it.”

• The IT director for a rural school system explained that A5 was a critical tool for them to protect key personnel who, if compromised, would severely damage their ability to operate. They said: “A5 is really for what I call the really important accounts [like] superintendents [and] our district secretary. Just the really small core of the school that sees and does a ton. Being a smaller school, you have to wear a lot of hats. For example, our district secretary is also our treasurer. There’s so many different documents that she has to be in charge of.”

• Among survey respondents, 88% cited improved threat protection and security (including identity) posture as a key outcome of adopting Microsoft 365 A5.

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

• The total annual risk exposure for the composite organization is approximately $1.1 million based on Forrester security survey data and scaled to the size of the organization.²

• There are two parts to the benefit calculation: 1) the benefit associated with reduction in the overall number of breaches and 2) the benefit associated with reduced cost of the remaining breaches, including improved remediation.

• The reduction in the overall number of breaches is 20% by Year 3, and the reduction in cost of remaining breaches is 25% by Year 3. This represents an incremental improvement over the prior state, including the tools and processes that were previously in place to maintain security.

Risks. The following risks impact the size of this benefit:

• The total risk exposure is highly variable between organizations.

• Variability in improvement in both breach avoidance and breach cost.

Results. To account for these risks, Forrester adjusted this benefit downward by 25%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $776,000.

Avoided Additional IT Security Team Member Hires

Evidence and data. According to interviewees, compared to a multivendor security stack, Microsoft 365 A5 improved IT security team efficiency and effectiveness through integrated solutions, centralized visibility, and built-in automation. This streamlined breach prevention, detection, and remediation; reduced management effort; and enabled teams to handle greater workloads without adding headcount. Interviewees and survey respondents shared examples of these gains:

• The chief information officer of an alternative high school described the situation prior to the deployment of Microsoft 365 A5: “Everything [outside of Microsoft] that plugs in, you need an integration. If we couldn’t work with the integrated solutions in A5, we would probably need at least two — possibly three — more resources to support responding and reporting.”

• The assistant superintendent of schools for a public school district said: “[We’re] simplifying the environment. We’re training people around one set of tools.”

• Among survey respondents, 73% said that they were able to lower internal IT costs due to less security and IT team efforts. The figure below shows the IT groups whose efficiency was most improved by the adoption of Microsoft 365 A5.

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

• The composite organization avoids adding incremental headcount to the IT security team due to the efficiencies gained through the use of Microsoft 365 A5.

• The institution avoids an additional 50% of the IT security team, or 1 additional FTE.

Risks. The risk that impacts the size of this benefit is that rather than keeping to the same level of responsibility, some organizations increased the tasks that the security team were able to cover. This reflects the increased efficiency gain with Microsoft 365 A5, as well as improved security practices, but introduces variability in the amount of staff headcount that can be avoided.

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 $161,000.

Reduced Employee Downtime

Evidence and data. Faculty and staff at interviewees’ and survey respondents’ organizations experienced less downtime due to fewer successful breaches and faster remediation of those that did occur. For the interviewees whose organizations moved from on-premises applications to a cloud-based platform, Microsoft 365 A5 also helped reduce downtime associated with on-premise solutions. Interviewees and survey respondents shared the following examples of reduced downtime:

• Interviewees agreed that the improved security associated with the move to Microsoft 365 A5 reduced the impact of security incidents on faculty and staff. In addition to incident prevention, they described the ability to investigate and resolve incidents more easily, without impacting users. The chief information officer of an alternative high school said, “We surface a lot of information having the advanced level solutions, which allows us to stop a lot of things before they become bigger issues for us.”

• The director of information services for a public school district added: “Certainly not having everything locked down improves learning experience. It’s hard to express what would be a good case there. I mean, if the network’s breached and everything gets locked down, no one’s doing much. There’s a very heavy reliance on the internet these days.”

• Survey respondents indicated that non-IT employees saved close to 200 hours a year due to the adoption of Microsoft 365 A5; this impact was due primarily to self-service time savings (56%) and less downtime (69%).

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

• The composite organization saves approximately 20 minutes per week for both teachers and staff.

• In Year 1, 50% of the benefit is realized as the solution is deployed and users become accustomed to it.

• Forrester assumes a conservative 25% of the time saved is redirected into productive work.

Risks. The following risks impact the size of this benefit:

• Productivity gains are very dependent on the use of the time saved, which is variable based on both the organization and the individual.

• The hourly rates for both faculty and staff vary widely between institutions as well as across regions.

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 $238,000.

Eliminated Costs Due To Power BI

Evidence and data. Interviewees noted that Power BI was included in the Microsoft 365 A5 solution, which was a differentiator from other versions. Several interviewees’ organizations eliminated their previous Power BI licenses as well as other analytics tools when they moved to Microsoft 365 A5. Interviewees noted this cost savings was an additional factor in the decision to move to Microsoft 365 A5, along with the cost savings achieved through the consolidation and elimination of duplicative security solutions.

• The assistant superintendent of schools for a public school district commented, “The incremental cost of moving to A5 from A3 was completely covered by the elimination of the separate Power BI licenses.”

• According to the chief information officer at an alternative high school, “While the main reason for our move to Microsoft 365 A5 was security, the second was definitely Power BI.”

• With the availability of Power BI in the Microsoft 365 A5 package, 72% of survey respondents indicated that their organization had better data analysis following the deployment.

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

• For the composite organization, the number of Power BI users is set at 5% of the total employee user population. While some interviewees had larger proportions of employees using Power BI, 5% is considered representative for the composite organization.

• The annual cost per user is $14 per month.

Risks. The risks that impact the size of this benefit include the cost savings associated with eliminating Power BI licenses, which is entirely dependent on the proportion of the users who need this application.

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 $24,000.

Unquantified Benefits

Interviewees and survey respondents mentioned the following additional benefits that their organizations experienced but were not able to quantify:

• Productivity gains through the use of Copilot Chat. All interviewees discussed the positive impact of having Copilot Chat available to all users within their organizations. For teachers, interviewees cited the use of Copilot Chat in creating lesson plans, quizzes, and reports; for staff, use cases included summarizing long documents and understanding legislation, among others. The impact of Microsoft 365 Copilot is discussed further in the Flexibility section.

• Improved security and compliance efforts with Purview. Several interviewees mentioned that the use of Purview was instrumental in their improved security processes, particularly in investigating compromised accounts. The assistant superintendent at a public school district mentioned that Purview “plays a huge role in our use of sensitivity labels,” while the chief information officer at an alternative high school cited the use of Purview for advanced e-discovery. Additionally, Purview was used in tandem with Microsoft 365 A5 to support AI initiatives and pilot programs.

• Additional opportunities through flexible learning models. Several interviewees mentioned the ability to leverage remote access. For one school district, online learning was a critical part of the educational model, which required the security capabilities of Microsoft 365 A5. At a private school, the director of technology described the seamless access to sensitive documents for the student support team, which was critical “to make sure that students’ needs are being met.” While this benefit has not been quantified for the financial analysis, it added value for all interviewees’ organizations.

• Improved learning experience. The IT director for a public school explained that reduced downtime improved trust and allowed students and staff to focus more on classroom outcomes. They detailed: “If we’re protecting our high-value targets with the most sensitive data the best we can, I think that makes the school better. If we had to shut the network down, we can’t have school. If we had some attack where student data is compromised, then they don’t feel protected in the school and that doesn’t lead them to have a high respect for the school. If they never have to think about me or their device, then they’re focusing on their classroom or on their students, or if you’re a student you’re focusing on your classwork that much more.”

Flexibility

The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement Microsoft 365 A5 and later realize additional uses and business opportunities, which would yield additional benefit after incremental investment. For the purposes of this analysis, we have quantified the benefit of implementing Microsoft 365 Copilot for a select group of users.

Evidence and data. The chief information officer at an alternative high school implemented a pilot program where 40% of teachers had paid licenses for Microsoft 365 Copilot. These teachers were able to drastically improve their lesson planning processes.

• The chief information officer at this organization shared the following: “Every single day, a teacher has to go in, look at the curriculum for the day, and determine what they want to communicate to students. That’s lesson planning. Every school, every teacher does this. Our teachers will plug in scope and sequence into Copilot, create workspaces, whether it’s in OneDrive or OneNote or whatever it might be, whatever tool they’re using that day, or Teams or something else, have Copilot spit the lesson plan directly out and upload that into scope and sequence. It’s super cool stuff!”

• The interviewee estimated that the teachers in the pilot group were able to create their lesson plans in 30 minutes, when previously it had taken them 3 to 4 hours a day.

While this is a single use case, interviewees anticipated that users would find more ways to leverage Microsoft 365 Copilot as familiarity with the solution grows and additional opportunities are identified.

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

• The number of users in the Microsoft 365 Copilot pilot group is initially 15% of the total users in Year 1 and grows to 23% in Year 2 and 30% in Year 3.

• Users save approximately 1.5 hours per week; as in the previous productivity benefit calculation, 25% of this time savings is expected to be redirected into productive work.

Costs. The additional investment required for this benefit is the cost of the Microsoft 365 Copilot licenses, which is $30 per user per month, as well as time spent on training as well as user discovery and experimentation.

Risks. The risks that impact the size of this benefit include the use of AI in the organization, which is very dependent on specific use cases and user adoption. Therefore, this benefit has inherent variability depending on the specifics of the institution.

Results. To account for these risks, Forrester adjusted this benefit downward by 5%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $491,000. This benefit is calculated to demonstrate the value of the additional investment in Microsoft 365 Copilot; it is not included in the core model results.

Flexibility quantification when evaluated as part of a specific project is described in more detail in Total Economic Impact Approach.