A FORRESTER TOTAL ECONOMIC IMPACT STUDY New Technology: The Projected Total Economic Impact™ Of Teams Premium Cost Savings And Business Benefits Enabled By Teams Premium JULY 2023
“Our [number of] meetings [has] gone up 250% since [before the COVID-19 pandemic], and [it hasn’t] dropped back down. When we look at the Microsoft dashboards compared to our peers, our meeting practice is generally poor. There’s a huge amount of time and effort invested in these meetings, so anything that can help improve those interactions is going to be a big benefit for all of us.” —Microsoft 365 product owner, financial services
With the number of meetings growing significantly the past few years and calendars becoming increasingly booked, IT and business leaders are looking for tools to lessen the burden on employees while making virtual and hybrid working more secure. Microsoft Teams Premium is an upgrade to the Microsoft Teams collaboration suite and is powered by AI technology, such as OpenAI’s generative pre-trained transformer (GPT). Teams Premium offers users advanced collaboration functionality such as intelligent recap, end-to-end encryption, and meeting customization. These capabilities are designed to make meetings more productive and engaging, events more accessible, organizations more secure, and employees’ time more focused on higher-value tasks. To better understand the benefits, costs, and risks associated with investing in a deployment of Microsoft Teams Premium, Forrester interviewed six representatives from five organizations and surveyed an additional 243 representatives with experience using and/or evaluating Teams Premium. After the investment in Teams Premium, organizations saw improvements in their pilot test groups and are either already expanding their Teams Premium usage or planning for expansion in the near future.
“If people were fully using Teams Premium, they would have [much] better meetings than they have today. I would love to see everyone utilize meeting options to their full extent, like role-specific meeting controls, watermarking, and intelligent recap.” — Lead of employee engagement and hybrid work, consumer packaged goods
PROI 108% to 360% BENEFITS PV $821,000 to $1.8 million NPV $426,000 to $1.4 million High impact NPV, $1.4M, PROI of 360% Mid impact NPV, $904.4K, PROI of 229% Low impact NPV, $425.7K, PROI of 108% -$200K $0K $200K $400K $600K $800K $1.0M $1.2M $1.4M $1.6M Initial Year 1 Year 2 Year 3 Key Findings Three-year Projected Financial Analysis for the Composite Organization Time to review notes from missed meetings using intelligent recap 50% to 90% reduced Time to schedule meetings using meeting templates & virtual appointments 40% to 80% reduced 98% of survey respondents with experience using Teams Premium said it would help their organizations avoid security incidents. Avoided cost of thirdparty licenses $141,000 to $376,000 Three-year impact to composite organization with 1,200 Teams Premium licenses
Methodology Forrester interviewed six representatives from five organizations and surveyed an additional 243 representatives with experience using and/or evaluating Teams Premium. From the information provided in the interviews and survey, Forrester constructed a New Technology: Projected Total Economic Impact™ framework for organizations considering an investment in Microsoft Teams Premium. The objective of the framework is to identify the potential cost, benefit, flexibility, and risk factors that affect the investment decision. Composite Organization For the purposes of this study, Forrester aggregated the interviewees’ and survey respondents’ experiences and combined the results into a single composite organization that is a global, multibillion-dollar organization headquartered in North America and serving mostly B2B channels. Employees have Office E5 licenses and use Microsoft productivity tools for communication and collaboration. Of these employees, 1,200 are identified to receive Teams Premium licenses. CUSTOMER INTERVIEWS Interviewed six representatives at five organizations using Teams Premium to obtain data with respect to costs, benefits, and risks. Surveyed an additional 243 IT collaboration suite decision-makers with experience using and/or evaluating Teams Premium. 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.
Role Industry Employees Lead of employee engagement and hybrid work Consumer packaged goods 20,000 Principal consultant Sulava, global systems integrator <200 Head of operations and application support BearingPoint, Management consulting 6,000 Microsoft 365 product owner Financial services 31,000 Senior innovation manager Financial services 31,000 Chief information officer Healthcare analytics <5,000 Customer Interviewees
Benefits Expected benefits of investing in Microsoft Teams Premium include freeing employees’ time through AI, automation, and scheduling functionality while improving the security position of the company through watermarking, end-to-end encryption, and sensitivity labels. Expected impact over three years for deployment of 1,200 licenses Figures in chart above are projections for the mid-case scenario, with a three-year total of $1.3 million $252,000 $58,000 $509,000 $481,000 Faster review of key meeting moments using intelligent recap Time saved using meeting templates and virtual appointments Saved labor from automatic live translation for captions in webinars Avoided cost of thirdparty licenses Three-year total benefits (PV)
“Tools like Teams Premium can help us shift our meeting culture and improve outcomes. We can divide and conquer meetings, and there will be an audit trail afterwards to help us track actions and decisions.” —Senior innovation manager, financial services
In prior environments, employees struggled to keep detailed notes during meetings, reducing overall effectiveness. This meant that when meetings were missed, significant time was required to catch up. It also meant that meetings were less effective as there was not an audit trail of decisions and additional time was required to discuss details of other meetings. Teams Premium intelligent recap was expected to enable significantly faster review of missed meetings. This was because intelligent recap uses generative artificial intelligence to review meeting recordings and provide a personalized recap to participants, as well as those unable to attend. Interviewed customers said that they expected employees to spend just five to 15 minutes reviewing meetings, as opposed to the 40 to 60 minutes it took previously. This saved labor is the equivalent of $323,000 to $639,000 to the composite organization over three years. Reduction in time to review notes from missed meetings using intelligent recap 50% to 90% Three-year benefit (PV) for deployment of 1,200 licenses $323,000 to $639,000 Faster Review Of Key Meeting Moments Using Intelligent Recap
“If you miss a bunch of meetings, then you can use intelligent recap instead of scrolling your way through everything to find one particular point. You could definitely save a few hours a week when you’re sick, traveling, or have a full calendar.” —Lead of employee engagement and hybrid work, consumer packaged goods
While all employees were spending more time in meetings, interviewees noted that, prior to Teams Premium, administrative employees were also spending significantly more time scheduling meetings due to an increase in the number of meetings and the type and format of meetings. After testing pilot groups, the time to schedule meetings using both meeting templates and virtual appointments was expected to fall similarly as the time to review notes using intelligent recap (63% to 92%). This saved labor is the equivalent of $328,000 to $689,000 to the composite organization over three years. Reduction in time to schedule meetings using meeting templates and virtual appointments 40% to 80% Time Saved Using Teams Meeting Templates And Virtual Appointments Three-year benefit (PV) for 120 employees scheduling large numbers of meetings $328,000 to $689,000
“Meeting templates save time. But, also from the company’s perspective, [leaders] know that the security settings are right. This can save IT support as well.” —Principal consultant, Sulava
Some interviewees and survey respondents produced webinars across several countries and languages as a core part of their business. To effectively reach diverse markets, the webinars either needed a live interpreter, or a manual transcript translation afterwards. Teams Premium allowed these moderators to instead offer automatic caption translation reducing costs and allowing for even more markets to be reached. Teams Premium allowed for webinar captions to be translated to a variety of languages in real time as the speaker was presenting. Interviewed customers said that they expected this to save several hours of work for each webinar when language translation was required. This saved labor is the equivalent of $323,000 to $639,000 to the composite organization over three years. Number of hours saved per webinar moderator per year 12 to 48 Saved Labor From Automatic Live Translation For Captions In Webinars Three-year benefit (PV) for 60 webinar moderators $29,000 to $116,000
“If you are a global organization with multiple nationalities, Teams Premium adds the possibility to create [real-time captions] for different languages, and that’s when you start adding value. You save time translating, but more importantly, you can reach people in their own language.” —Principal consultant, Sulava
Interviewees and survey respondents expected that Teams Premium would allow them to either retire or partially reduce usage of third-party tools and licenses. While the specific tools being reduced varied by company, they tended to fall into categories of third-party video calling tools, meeting encryption software, and webinar hosting platforms. Teams Premium provided interviewed and surveyed customers with many of the same functionality which they had been paying for separately from third-party vendors. Interviewed customers said that they expected to eliminate some of these licenses due to Teams Premium. This was especially true for third-party video calling, meeting encryption, and webinar licenses. This saves the composite organization $141,000 to $376,000 over three years. Licenses most likely to be named for consolidation due to Teams Premium: • Video calling • Meeting encryption • Webinar hosting Avoided Costs Of Third-Party Licenses Three-year benefit (PV) for deployment of 1,200 licenses $141,000 to $376,000
“The end-to-end encryption is going to make it possible for companies to basically drop out of external protected meeting software and start using Teams Premium instead.” —Principal consultant, Sulava
Unquantified Benefits Interviewees and survey respondents expected many other benefits from Teams Premium, which they were not able to quantify. Protection of intellectual property through watermarking, sensitivity labels, preset meeting security settings, and end-to-end encryption Ability to address future security concerns and get ahead of complex issues (in part) by reducing risk of employees inadvertently sharing confidential information More effective meetings, reducing the cognitive load for employees and enabling participants to make better decisions More accurate recaps and notes, resulting in fewer errors and misrepresentations Live caption translation during webinar events enables broader reach of more diverse audiences by supporting multiple languages in real time Additional saved time after meetings enabling employees to reallocate their time to higher value tasks and improving employee satisfaction
“We are just dipping our toe inthe water with generative AI [and] experimenting with what I call ‘safe’ use cases. And one of those safe use cases is Teams Premium.” — Chief information officer, healthcare analytics “A lot of these features will save people time and … sanity. They will result in better quality meetings overall.” — Lead of employee engagement and hybrid work, consumer packaged goods
Appendix A: New Technology: Projected Total Economic Impact Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders. . Total Economic Impact Approach Projected Benefits represent the projected value to be delivered to the business by the product. The New Tech TEI methodology places equal weight on the measure of projected benefits and the measure of projected costs, allowing for a full examination of the effect of the technology on the entire organization. Projected Costs consider all expenses necessary to deliver the proposed value of the product. The projected cost category within New Tech TEI captures incremental ongoing costs over the existing environment that are associated with the solution. Flexibility represents the strategic value that can be obtained for some future additional investment building on top of the initial investment already made. Having the ability to capture that benefit has a PV that can be estimated. Risks measure the uncertainty of benefit and cost estimates given: 1) the likelihood that estimates will meet original projections and 2) the likelihood that estimates will be tracked over time. TEI risk factors are based on “triangular distribution.” ! Present value (PV) The present or current value of (discounted) cost and benefit estimates given at an interest rate (the discount rate). The PV of costs and benefits feed into the total NPV of cash flows. Projected net present value (PNPV) The projected present or current value of (discounted) future net cash flows given an interest rate (the discount rate). A positive project PNPV normally indicates that the investment should be made, unless other projects have higher PNPVs. Projected return on investment (PROI) A project’s expected return in percentage terms. PROI 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%. The initial investment column contains costs incurred at “time 0” or at the beginning of month 1 that are not discounted. All other cash flows are discounted using the discount rate at the end of the eighteen-month period. 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.
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