6 minute readDetermining the Potential ROI of Your Storage Project
Sometimes IT professionals and those on the business end of the organization do not speak the same language when it comes to evaluating a project. IT professionals tend to use technical metrics to measure value while the business side of an organization will likely use revenue, profitability, and satisfied customers to gauge value. So, these two sides are frequently disconnected on how to determine and assess value a storage project proposal is presented. They will be interested in knowing how the storage project you are presenting will make money, make the business more flexible and dynamic, or enable the business to provide better service to customers.
Essentially, you may need to be able to provide an estimate of the ROI of the investment necessary for your storage project in order to get the project approved by a board, budget committee, or group. And, even if you are not asked to present this ROI estimate during your proposal, knowing an ROI estimate can help you have more confidence in your project as well as your own skillset on the business side. So, we are providing some tips on how to estimate the ROI that is associated with your storage project.
1. Determine the Cost of Doing Nothing
One way you can present the case that improving your storage infrastructure is a good investment is by showing the potential cost involved with doing nothing. So, for example, let’s say you’re pitching the need to replace a current array with an array that has better performance as well as DR capabilities. In order to demonstrate ROI, you could start by calculating:
• If your current storage infrastructure has a performance or DR event, how many people would be affected? For example, how many customers who touch applications hosted via shared storage or vendors who log into your system or are a part of your supply chain would be affected?
• Would you lose trust or goodwill with your customers if your system goes down or doesn’t react fast enough?
• What could be the long-term impact of a disaster recovery event? What about the impact on the brand’s image or financial capabilities?
This impact involves both quantitative and qualitative measures – and both have value for your organization. If you are not sure how to go about measuring these impacts, look to find a similar event in the past or at another company in your industry area. Once the cost of doing nothing is thoroughly assessed, you can continue to make the case for your storage project via determining the savings your project will create.
2. Determine Potential Savings
If you have multiple storage arrays, storage consolidation can help you save costs on maintenance, power, cooling, and administrative time required to manage multiple arrays. Additionally, there are other types of cost savings you can take into account:
• Elimination of multiple maintenance agreements.
• Reduction of Rackspace.
• Saving time.
These are just a few of the types of savings you can have if you look into storage consolidation or consider a new storage project. Undoubtedly, there are many more possibilities to save time and money with potential projects and these may vary depending on the type of project you are considering. The next step in determining a ROI estimate is to calculate added agility and profitability for the organization.
3. Calculate Added Agility and Profitability
In addition to determining the cost of doing nothing and estimating the potential savings of your proposed storage project, calculating the extra business agility and profitability your storage project will bring the company can add another dimension to your ROI estimation.
• Turning negative energy into positive energy. If your system is not performing well, that under-performing system can be a headache for your organization’s application designers, engineers, and DBA. Instead of spending time and energy investing into a system that limits productivity, that energy could be redirected to improving and developing future applications to help boost teamwork, results, and revenue.
• Boost Profitability and Agility. Improved uptime capabilities and performance can help provide a competitive edge that you can use to help win market share and become more efficient and profitable. Also, a better storage infrastructure can give your CEO options for launching another business unit or buying a company. In order to have true business agility, you will need the right storage infrastructure to be able to turn on a dime and be able to increase revenue, gross margin, or net income. Additionally, a better storage infrastructure can give you the ability to have multiple copies of a new revenue-producing application in development, test, or QA so you can launch the application sooner while ensuring it is more stable and bug-free.
• Hire and Keep the Best IT Talent. Having a superior storage infrastructure can help you hire the best app developers, DBAs, and IT architects. Having more capacity or raw space can help attract the best talent that can proceed to take your investment in a storage project and turn that investment into a database that can fuel millions of dollars worth of improved productivity.
So, as you can see, having a strong estimate of what the ROI would look like for your storage project proposal can help push that proposal into action. If you need help with justifying your proposed project or need a quote on an affordable system from highly trusted manufacturers to help get the project approved, reach out to Reliant anytime via chat, email, or phone.