Microsoft Study Suggests Office 365 Brings 300 Percent ROI

Matthew Weinberger

October 14, 2011

2 Min Read
Microsoft Study Suggests Office 365 Brings 300 Percent ROI

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A new Microsoft-commissioned study suggests organizations that adopt the Microsoft Office 365 cloud productivity suite get a 321 percent return on investment (ROI), with a payback period of only two months. Impressive findings — but I’m inclined to take them with a grain of salt. Here’s why:

The study, conducted by respected research firm Forrester, interviewed seven SMBs who made the Office 365 switch and used that data to “[create] a composite midsize organization based on the experience of these organizations,” according to the Microsoft blog entry. This composite had 150 employees, some of whom were mobile, some at HQ and some at branch offices across the globe.

This hypothetical Office 365 deployment cost $277,000, with a calculated $1.17 million in savings. Hence, 321 percent ROI with a break-even of two months. Here’s the full breakdown of savings, according to that press release:

  2. Knowledge worker productivity gain: $657,000 across all employees in the organization

  4. Mobile worker incremental productivity gain: $168,750 over three years

  6. Eliminated hardware: Savings of $64,000 over three years

  8. Eliminated third-party software: Savings of $10,000 over three years

  10. Web conferencing savings: Savings of $25,000 over the life of the study

  12. Substituted Microsoft licenses: Savings of $125,000 in the initial period of the study

  14. Avoided on-premises planning and implementation labor: Savings of $35,000 in internal labor and professional services costs

  16. Reduced IT support effort: Savings of $206,350 over three years

  18. Reduced travel costs and corresponding CO2 emissions: Savings of $260,625 over the life of the study and a reduction of 47,000 kg of CO2 emissions from air travel

Here’s why I remain unimpressed with this study: I’m not going to argue that Microsoft Office 365 provides all kinds of cost savings. But what about organizations smaller than 150 seats? Or larger? What if they’re not migrating from an existing Windows environment? And wouldn’t a Google Apps deployment provide similar TCO and ROI benefits?

I don’t mean to be overly cynical, but when Microsoft commissions a study on the benefits of going with Microsoft in the cloud, I have to be a little wary.

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Matthew Weinberger

Matthew Weinberger

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