IT ROI and Resilience in the Age of COVID-19

In a time of crisis and growing uncertainty, decision-makers look to frameworks for investing in critical IT capabilities that can adapt to meet future needs.

By Michael Brenner

By Michael Brenner July 17, 2020

As enterprise IT becomes more software-defined, workloads can increasingly live anywhere. This has many companies undertaking IT ROI analysis that could lead to ditching status quo systems for modern technologies like hyperconverged infrastructure (HCI). 

Now more than ever, organizations are counting their IT dollars, but most acknowledge that the impact of COVID-19 has emphasized the need for reliable, scalable IT capabilities. IT decision-makers have a lot more on their plates, as new technologies and services become part of their company’s operations, so they need to carefully but quickly access how they will spend on critical needs, according to Steven Kaplan, author of The ROI Story: A Guide for IT Leaders and Vice President of Customer Success Finance at Nutanix.

“We find that return on investment is probably a better metric in most cases,” Kaplan said in a recent episode of the podcast, Tech Barometer from The Forecast by Nutanix.

Using ROI to Shape IT Infrastructure

The concept of return on investment is a simple one to grasp. For example, if someone was deciding whether or not to purchase a new bicycle, they’d rationalize that the bike will cost money upfront, but owning it could cut down spending on public transportation.

While the cost-saving benefits of the bike may be attractive, there are other factors at play. The bike gets you moving – it allows you to spend more time outdoors. Riding your bike instead of driving or catching transport also reduces your carbon footprint. The more factors you include, the more expansive and detailed the story you begin to construct, the more you begin to appreciate the true ROI of the bike. It’s clearly the better choice, despite the upfront investment.

The same process can be applied to an organization’s IT infrastructure when comparing like technologies.

“For example, say someone is running physical desktops and is looking at going to virtual desktops,” explained Kaplan. “In the status-quo environment, staying with physical desktops means there’s no real per se investment. Whereas if they want to go to virtual desktops, VDI, now they have to make a significant investment – not just in dollars but also in time, training, support and so on.”

ROI is an important metric. But when an ROI analysis is undertaken, it needs to go beyond the superficial and account for all the costs that could impact a solution.

Don’t Leave Intel on the Table

ROI analysis is more than an exercise. Companies must outline what their future looks like, even if it’s vastly different from what they’re used to and comfortable with.

“As good as your financial analysis might be, displacing status quo infrastructure has a lot of emotions tied to it,” said Kaplan. “And so, in addition to compelling economics, what’s really needed is a story.”

ROI evaluation takes IT decision-making out of the hands of human error, emotion, subjectivity, and perception. Choosing an infrastructure or platform isn’t all about minimizing IT costs. It’s about satisfying business objectives, too – a sentiment that’s more critical today than perhaps ever before.

Long-Term Investing Helped During the COVID-19 Crisis

Modernizing with HCI, which creates private cloud-like data centers, is, for many organizations, the first step in their digital transformation. Companies that have kept their eye on the long game and made decisions based on a fully-developed ROI analysis have found themselves uniquely positioned to make the critical operational changes the COVID-19 situation has demanded.

Take Hastings Prince Edward Public Health (HPEPH) in Ontario, Canada, as an example. HPEPH is a public agency that offers several programs and services to citizens across the Eastern Ontario region. Prior to the COVID-19 outbreak in March, the IT department – headed by IT systems manager Tom Lockhart – had made the switch to virtual desktop infrastructure running on scalable HCI to allow staff to access electronic medical records (EMR) and other applications.

When restrictions took hold, HPEPH saw hundreds of staff needing to work from home – but remote access to information wasn’t an issue. The agency already had VDI powered by Nutanix enterprise cloud software in place, enabling employees to access business applications and secure data from anywhere from day one of their work-from-home policy.

“For organizations in a physical desktop model, I can’t imagine how you could deploy something like this in the amount of time we had,” Lockhart said. “I wouldn’t even want to worry about infrastructure right now.”

The $62B UK-based telecommunications company Vodaphone is yet another example of how forward-thinking IT strategy has helped the team reconfigure their operations amid the pandemic. Vodaphone relies on virtual desktop technology on both HCI and public cloud to serve its 50,000-plus concurrent employees across a number of countries. Now, that implementation is delivering a high degree of resilience.

“Eighty-five percent of our use cases are based on application virtualization – Server Based Computing (SBC),” said Michael Janssen, lead architect for remote access at Vodafone. “We are in the middle of a migration from traditional three-tier virtualization technology on-prem to a new hybrid architecture combining Nutanix HCI and Microsoft Azure public cloud.”

According to Kaplan, an ROI analysis helps evaluate software-defined technologies such as HCI or public cloud, but it also provides the framework for galvanizing decision-makers to move out of their comfort zones and make the best technology choice for the future of their organization.

Michael Brenner is a keynote speaker, author and CEO of Marketing Insider Group. Michael has written hundreds of articles on sites such as Forbes, Entrepreneur Magazine, and The Guardian and he speaks at dozens of leadership conferences each year covering topics such as marketing, leadership, technology and business strategy. Follow him @BrennerMichael.

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