The Forrester report ‘Total Impact of Google Apps‘ provides a framework for identifying the ROI from switching from a legacy mail and collaboration platform to Google Apps.

Surveying 200+ organizations with over 1,000 employees, Forrester identified the main business benefits required to build an ROI framework for moving to a Cloud-based service, which essentially broke down into two main categories:

• IT infrastructure cost savings
• Staff productivity increases

The IT infrastructure savings provides the hard numbers for justifying the business case, enabling cost reduction in areas you would expect like software licences, hardware and IT administrator costs, and delivers an ROI:

• Break even within 1.4 months
• 329% risk-adjusted ROI
• A Net Present Value of over $10m following an investment of $400k

For many organizations the catalyst for the switch is a degrading email system experiencing performance issues that have become intolerable to the mission critical status that email now has for the organization.

So this means making the move solves this burning need and simultaneously maximizes cost savings through avoiding future costs related to maintaining on-site IT infrastructure, such as winding down their need for equipment like VPNs.

App to App Synergy

This immediate payback means that the additional ROI benefits from staff productivity are a ‘free bonus’ on top, however it’s important to note just how beneficial these are and how the business can exploit them.

Indeed Forrester then make the critical point that even greater business impact is enjoyed through increases in staff productivity, highlighting features and benefits like more efficient document collaboration and more effective virtual meetings.

These are more intangible ROI benefits, not as easy to quantify in immediate $$ dollar terms, however by considering them within a broader context of process improvement, and identifying how these personal productivity gains are component parts of broader workflow enhancements, then senior executives can start to relate to them in terms important to them.

For example:

• Sales teams producing more client proposals faster
• Quicker resolution of customer service issues
• Improved technical documentation

A key mechanism to achieving this productivity improvement is what Google describe as ’App to App’ synergy, referring to the SSO (Single Sign On) environment that Google offers for the suite of collaboration tools. They highlight how staff enjoy time-saving productivity boosts by accessing email, VoIP and video conferencing all from within the web browser.

Social Workflow – 9x Process Improvements

This may seem like a relatively unimportant technical feature in the grand scheme of enterprise applications, however when you consider that one of the primary issues IT faces is user adoption of new applications you can see just how key it actually is.

Indeed these principles are crucial for organizations also considering their enterprise social media strategy – How to internalize Web 2.0 tools like building your own private Linkedin type site or encouraging better knowledge sharing through staff use of blogs and wikis.

In this article the originator of this Enterprise 2.0 concept Andrew McAfee described how these new social media technologies faced the challenge that use of email was so entrenched that the new tools would need to be 9x more useful for them to switch, not just a little better.

Given just how much staff work within email on a day to day basis it is probably not even possible that they even would at all, and so Google addresses the situation by “bringing the mountain to Mohammed” – They embed these new collaboration methods directly into email.

There is no need to switch out to different social media and collaboration apps, they are built direct into the email interface itself.

This blending together is key to unlocking the transformational power of these technologies.

In an earlier white paper that builds on Andrew’s Enterprise 2.0 work, ‘Harnessing the Wikipedia Effect’, I described how it enables ’Knowledge Process Management’, referring to blending together the previously separate applications for Knowledge Management, those for Business Process Management and also the communications and collaboration apps.

The trend is also very effectively described in this article – Enterprise Apps Get Social.

What Google Apps is offering is this powerful effect distilled into an easily accessible online service, the essence of the business value of Cloud Computing.