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Cloud Computing – The IT Solution for the 21st Century Scenario 2 – Switching HR from dedicated IT to private SaaS


Example firm, food & beverage, $10b revenue, 60,000 employees, 30 countries


Cost of switching Implementation costs Hardware purchase Data migration


# of FTE consultants FTE rate Total cost


System customization Server virtualization Training Headcount reduction


# of FTE consultants FTE rate Total cost


# of FTE consultants FTE rate Total cost


# of FTE consultants FTE rate Total cost # of FTE FTE rate


Redundancy percentage


Total headcount reduction cost Total implementation cost


Private cloud costs Capital costs


License fees Operational costs Support Subscription fee


Hardware purchase Electricity


# of FTE consultants FTE rate


Total support cost Total cost of ownership Legacy solution Total lifetime cost


Dedicated IT costs Capital costs Hardware purchase Implementation


# of FTE consultants FTE rate Total cost


Operational costs License fee


Hardware purchase Electricity Support


# of FTE consultants FTE rate


Total support cost Total cost of ownership Year 1 Year 2 Year 3 Year 4 Year 5


$0 $0 25


$90,000


$2,250,000 15


$90,000


$90,000 $720,000 14


$60,000 $840,000 5


$70,000 50%


$175,000


$0 $0 0


$90,000 $0 15


$90,000


$1,350,000 $1,350,000 8


0


$90,000 $0 0


$60,000 $0 0


$70,000 50% $0


$5,335,000 $1,350,000 $0


$5,000,000 $0


$50,000 $0 0


$70,000


$0 $0 $0


$50,000 $296,345 15


$70,000


$0 $0 0


$90,000 $0 0


$90,000 $0 0


$90,000 $0 0


$60,000 $0 0


$70,000 50% $0 $0


$0 $0 $0


$50,000 $326,905 15


$70,000


$0 $0 0


$90,000 $0 0


$90,000 $0 0


$90,000 $0 0


$60,000 $0 0


$70,000 50% $0 $0


$0 $0 $0


$50,000 $359,347 15


$70,000


$0 $0 0


$90,000 $0 0


$90,000 $0 0


$90,000 $0 0


$60,000 $0 0


$70,000 50% $0 $0


$0 $0 $0


$50,000 $393,283 15


$70,000


$0 $1,050,000 $1,050,000 $1,050,000 $1,050,000 $5,050,000 $1,396,345 $1,426,905 $1,459,347 $1,493,283 $2,573,134 $20,090,013


$0 $0 50


$90,000


$5,000,000 $200,000


$70,000


$0 $0 15


$90,000 $4,500,000 $1,350,000 $0 $200,000 20 $70,000


$0 $0 0


$90,000 $0


$0 $200,000 20 $70,000


$0 $0 0


$90,000 $0


$0 $200,000 20 $70,000


$0 $0 0


$90,000 $0


$0 $200,000


$979,134 $1,076,753 $1,176,271 $1,273,244 $1,364,588 20


20 $70,000


$1,400,000 $1,400,000 $1,400,000 $1,400,000 $1,400,000 $12,079,134 $4,026,753 $2,776,271 $2,873,244 $2,964,588


22


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