The Business Value of Red Hat CloudForms

When talking to IT leaders about Red Hat CloudForms, we often point out the time and cost savings that CloudForms can have on their organization. While we have several customer success stories that highlight the various benefits of CloudForms to each organization, we wanted a more formal study of the business value that CloudForms could bring to an organization. To that end, Red Hat commissioned a study, conducted by IDC, to look at the business value of CloudForms. This blog post will highlight some of their findings, with IDC’s complete report available for review.

For this study, IDC conducted in-depth interviews with seven organizations, of various sizes and from a variety of industries, that had deployed CloudForms. The organizations were running application workloads across physical, virtualized, and private cloud environments, with some also using public cloud or container-based environments. All of the organizations cited the pressure to manage these diverse environments as a key reason to implement CloudForms. The interviews sought to uncover both quantitative and qualitative impacts that could be traced to the implementation of CloudForms. Let’s take a closer at some of IDC’s findings.

Increasing IT Agility

In most organizations, responding to IT service requests requires significant staff time and can take weeks to deliver on a request. This makes the IT operations team a bottleneck for new initiatives required by the business. Organizations in the study showed a significant increase in their ability to deliver on service requests in a more timely manner. On average, they took 89% less calendar time to deliver on requests and requests required 92% less staff time. This improvement has allowed IT organizations to increase the number of requests that they can process, handling more than 20 times more requests on average. This in turn has allowed the IT organization to become more agile, supporting application development teams in their bid to accelerate application development.

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Accelerating Application Delivery

In fact, IDC found that CloudForms can have a dramatic impact on application development teams and their ability to support the business. The efficiency CloudForms brings to the service delivery process translates into greater productivity for application development teams because they spend less time waiting for resources. Organizations using CloudForms were able to reduce the time to deliver a new application by 37% and almost double the number of new applications that could be delivered in a year (93% more on average). Delivering more applications, faster should be what every business strives for today.

app-dev-impact

Improving Business Results

The result of increasing the application development’s team efficiency and ability to deliver means that the business can respond faster and more effectively to changes in the business environment. IDC found that CloudForms contributed in this area as well. Approximately one-half of the organizations in the study reported that they were generating more revenue with CloudForms than without. The average revenue increase was $3.85 million per year and was a result of the businesses being enabled to respond more quickly to customer demands. It’s not often that you find an IT operations solution that can contribute to your organizations top-line.

Business Value of CloudForms

These are just some of the key highlights. IDC collected all of the benefits they found and categorized them into four main areas: IT staff productivity benefits, business productivity benefits, risk mitigation, and IT infrastructure cost reductions. When summed up, they found that, on average, organizations could realize $3.46 million in benefits per year (or $11,937 per 100 users per year), a . And when factoring in costs, they found that CloudForms offered an ROI of 436% and a payback period of only 8 months.

average-annual-benefits

This report has given us new insights into the benefits that CloudForms can have on organizations, beyond just the IT operations team. It has also provided a more methodical study of the benefits. I invite you to take a look at the complete report and determine how CloudForms can benefit your organization.

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