{"id":66649,"date":"2023-06-05T17:24:02","date_gmt":"2023-06-05T21:24:02","guid":{"rendered":"https:\/\/jumpcloud.com\/?p=66649"},"modified":"2024-08-14T16:57:41","modified_gmt":"2024-08-14T20:57:41","slug":"tco-it-proposal","status":"publish","type":"post","link":"https:\/\/jumpcloud.com\/blog\/tco-it-proposal","title":{"rendered":"Leveraging TCO to Justify an IT Proposal"},"content":{"rendered":"\n<p>Rejection always stings. But getting a great idea shot down after you and your team worked tirelessly to come up with it? An idea that you <em>know<\/em> will work? That really burns.<\/p>\n\n\n\n<p>No matter how good an idea is, it generally can\u2019t move forward without a stamp of approval from the powers that be (whether that\u2019s a director, C-suite member, board, or all of the above). When it comes to driving positive change for your team, getting leadership on board is half the battle. Every good idea needs a clear and compelling proposal to back it up.&nbsp;<\/p>\n\n\n\n<p><a href=\"https:\/\/community.jumpcloud.com\/t5\/radical-admin-blog\/understanding-tco-and-your-stack\/ba-p\/2401\" target=\"_blank\" rel=\"noreferrer noopener\">Total cost of ownership (TCO)<\/a> is a strong \u2014 yet often overlooked \u2014 figure that can help quantify and contextualize proposed IT initiatives. When applied to proposals, TCO can act as the hard numbers that clarify an initiative\u2019s cost-effectiveness \u2014 a critical selling point.\u00a0<\/p>\n\n\n\n<p>This blog covers best practices around leveraging TCO in proposals to help you improve the likelihood of getting initiatives approved. It assumes a basic understanding of how to calculate TCO \u2014 if you\u2019re not sure how to do so, we recommend starting with the <a href=\"https:\/\/jumpcloud.com\/resources\/tco-calculation-guide\">IT Professional\u2019s Guide to Calculating TCO<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-proposal-best-practices\"><strong>Proposal Best Practices<\/strong><\/h2>\n\n\n\n<p>Before diving into the specifics of using TCO in a proposal, let\u2019s establish a baseline of proposal best practices. These are the foundational elements of a clear and compelling proposal.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-1-communicate-costs-clearly-and-lead-with-hard-numbers\">1. Communicate costs clearly and lead with hard numbers.<\/h3>\n\n\n\n<p>Summarize the key takeaways from your TCO analyses with a few hard numbers.&nbsp;<\/p>\n\n\n\n<ul>\n<li><strong><em>Example:<\/em><\/strong> Our company will save about $15,000 in the next five years by switching from on-premises file servers to a cloud storage solution.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-2-communicate-business-benefits-explicitly-with-hard-numbers-where-possible-nbsp\">2. Communicate business benefits explicitly with hard numbers where possible.&nbsp;<\/h3>\n\n\n\n<p>Business benefits are sometimes underrepresented in proposals. But when explicitly stated and contextualized with hard numbers, they can be highly compelling.&nbsp;<\/p>\n\n\n\n<ul>\n<li><strong><em>Example:<\/em><\/strong><em> <\/em>Investing in this <a href=\"https:\/\/jumpcloud.com\/blog\/what-is-single-sign-on-sso\">single sign-on solution<\/a> will allow us to reduce our support ticket requests by 40%.&nbsp;<\/li>\n\n\n\n<li><strong><em>Example:<\/em><\/strong><em> <\/em>This capability improves our security posture by putting us one step closer to ISO 27001 compliance.<\/li>\n\n\n\n<li><strong><em>Example<\/em><\/strong><strong>:<\/strong> By <a href=\"https:\/\/jumpcloud.com\/blog\/it-unification\">consolidating disparate products<\/a> into a single platform, we can reduce our licenses, integrations, and operational costs by $30,000 per year.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-3-anticipate-and-address-objections-nbsp\">3. Anticipate and address objections.&nbsp;<\/h3>\n\n\n\n<p>It\u2019s rare that a proposal is approved without a hitch \u2014 leaders will almost always have questions and points of hesitancy. Try to anticipate what they might be and head them off by explicitly bringing them up and refuting them.&nbsp;<\/p>\n\n\n\n<ul>\n<li><strong><em>Example:<\/em><\/strong><strong> <\/strong>A common objection to cloud migration is that the company has already spent a considerable amount on their on-premises hardware, but this argument ignores future expenses. The reality is that legacy systems are expensive investments with costly upkeep. High upfront costs don\u2019t mean that costs will be lower over time, nor that using the technology for its full lifespan will save the company money. Legacy infrastructure maintenance, management, and support costs will only rise as the technology gets older, eventually requiring <em>additional<\/em> hefty investments to keep it going once hardware inevitably needs to be replaced.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-4-include-objectives-and-measurable-kpis-in-your-proposal\">4. Include objectives and measurable KPIs in your proposal.<\/h3>\n\n\n\n<p>Including objectives and KPIs will help leaders visualize the plan\u2019s potential. Follow the SMART goal-setting method:<\/p>\n\n\n\n<div class=\"columns wp-block-columns is-layout-flex wp-container-core-columns-is-layout-1 wp-block-columns-is-layout-flex\">\n<div class=\"column wp-block-column is-layout-flow wp-block-column-is-layout-flow\" style=\"flex-basis:100%\">\n<p><strong>S<\/strong>pecific<\/p>\n\n\n\n<p><strong>M<\/strong>easurable<\/p>\n\n\n\n<p><strong>A<\/strong>chievable<\/p>\n\n\n\n<p><strong>R<\/strong>elevant<\/p>\n\n\n\n<p><strong>T<\/strong>ime-bound<\/p>\n<\/div>\n<\/div>\n\n\n\n<ul>\n<li><strong><em>Example: <\/em><\/strong>Upon adopting a cloud-based directory, we will <a href=\"https:\/\/jumpcloud.com\/blog\/automate-active-directory-migration-tool\">phase out Active Directory<\/a> within three months.<\/li>\n\n\n\n<li><strong><em>Example: <\/em><\/strong>By adding <a href=\"https:\/\/jumpcloud.com\/blog\/zero-touch-enrollment-device-deployment\">zero touch enrollment<\/a>, IT will reduce average employee onboarding time from one hour to 15 minutes within one month of adoption.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-5-set-a-timeline-to-keep-estimations-realistic-and-contextualized\">5. Set a timeline to keep estimations realistic and contextualized.<\/h3>\n\n\n\n<ul>\n<li><strong><em>Example: <\/em><\/strong>This proposal includes a projection of the proposed solution\u2019s TCO over the next five years.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-6-clearly-communicate-the-cost-and-risk-of-not-moving-forward-with-the-proposal-nbsp\">6. Clearly communicate the cost and risk of <em>not<\/em> moving forward with the proposal.&nbsp;<\/h3>\n\n\n\n<p>While communicating the benefits of a proposed solution is critical to a successful proposal, it\u2019s also important to clarify the downsides of <em>not<\/em> moving forward with it. Clarifying these risks \u2014 and quantifying them where possible \u2014 helps create urgency and another compelling reason for leadership to approve the initiative.<\/p>\n\n\n\n<ul>\n<li><strong><em>Example:<\/em><\/strong><strong> <\/strong>If we do not switch to a <a href=\"https:\/\/jumpcloud.com\/blog\/what-cloud-directory\">cloud-based directory<\/a>, we will have to pay roughly $25,000 in on-premises directory infrastructure upkeep within the next five years. This cost would be eliminated with the cloud-based alternative.&nbsp;<\/li>\n\n\n\n<li><strong><em>Example:<\/em><\/strong> If we do not invest in an off-site backup, we run the risk of losing business-critical data and incurring irreparable damage.<\/li>\n<\/ul>\n\n\n\n<div class=\"promotion-banner-small is-flex-direction-column has-items-aligned-flex-start has-items-aligned-center-tablet\">\n    <div class=\"promo-small-image is-hidden-mobile\">\n        <img decoding=\"async\" src=\"https:\/\/jumpcloud.com\/wp-content\/uploads\/2023\/05\/itunification-aspect-ratio-160-110.jpg\" alt=\"JumpCloud\">\n    <\/div>\n    <div class=\"promo-small-content\">\n        <p class=\"is-type-body-tiny is-type-weight-bold is-important promo-small-title\">\n            Reduce Your Organization's IT Sprawl        <\/p>\n        <p class=\"is-type-body-default is-important\">\n            Exchange disparate point solutions for a full-scale IT management platform to unify your environment.        <\/p>\n    <\/div>\n    <div class=\"promo-small-cta\">\n        <a href=\"https:\/\/jumpcloud.com\/resources\/it-sprawl-reverse\" data-promo=\"Unification\" class=\"button is-primary-green promo-small-banner-link\">Learn More<\/a>\n    <\/div>\n<\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-using-tco-in-your-proposal-nbsp\"><strong>Using TCO in Your Proposal&nbsp;<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-representing-tco\">Representing TCO<\/h3>\n\n\n\n<p>When it comes to actually representing TCO in a proposal, it should be clear, impactful, and easy to follow. Try to strike a balance between providing enough detail and not overwhelming your audience with information. Identify the most important and compelling numbers \u2014 i.e., initial costs, decreased costs per user, and projected savings over a period of time \u2014&nbsp;and highlight them throughout your proposal. Don\u2019t forget to include these numbers when communicating benefits and the bottom line.&nbsp;<\/p>\n\n\n\n<p>Visually representing data is a great way to keep the audience engaged. Keep spreadsheets and lists of numbers short, bold or highlight important figures, and include graphs and tables where appropriate. For clean charts and comparisons, <a href=\"https:\/\/jumpcloud.com\/tco-calculation-template\">try out JumpCloud\u2019s TCO calculation template<\/a> \u2014 it generates graphs and visual summaries of data that work great in proposals.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-create-a-compelling-comparison\">Create a Compelling Comparison<\/h3>\n\n\n\n<p>If you\u2019re proposing an alternative to existing technology, the most compelling TCO argument will be that your proposed solution offers lower TCO than your current one. In these cases, include a TCO comparison in your proposal for context, and consider the following methods for highlighting TCO wins.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"h-1-include-every-line-item-in-both-solutions-and-zero-out-the-ones-that-don-t-apply-nbsp\">1. Include every line item in both solutions, and zero out the ones that don\u2019t apply.&nbsp;<\/h4>\n\n\n\n<p>A side-by-side comparison helps show how a proposed solution reduces complexity and expenses. For example, when comparing legacy and cloud solutions, the cloud option could zero out most line items for infrastructure equipment and data center hosting costs to create an impactful visual of its cost savings.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"h-2-account-for-any-features-and-capabilities-that-would-be-a-result-of-a-proposed-switch\">2. Account for any features and capabilities that would be a result of a proposed switch.<\/h4>\n\n\n\n<p>If a proposed solution includes more capabilities than your current one, highlight these additional benefits by making them separate line items. If your current one achieves these capabilities with a separate tool, note the cost of the separate tool; if it doesn\u2019t have these capabilities at all, mark them with an N\/A.&nbsp;<\/p>\n\n\n\n<p>For example, if a proposed directory solution includes mobile device management (<a href=\"https:\/\/jumpcloud.com\/blog\/mdm-mobile-device-management\">MDM<\/a>) and your current one does not, include an additional line item for MDM in your TCO calculation of both solutions. For the proposed directory solution that includes MDM, it would not incur an extra cost; for your current solution, mark the cost of the MDM tool you use, or \u201cN\/A\u201d if you do not have an MDM tool.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"h-3-highlight-each-solution-s-projected-future-tco-nbsp\">3. Highlight each solution\u2019s projected future TCO.&nbsp;<\/h4>\n\n\n\n<p>Often, \u201csunken costs\u201d arguments come into play when solution alternatives are proposed: leaders don\u2019t want to part with solutions they\u2019ve already invested heavily in. Showing them that your proposed alternative will yield significant <em>future <\/em>savings regardless of their past expenses can help counteract this hesitancy. Do this by defining a time period of at least a few years, and highlighting the total savings your proposed solution would generate within that time period in your proposal.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-consider-all-angles\"><strong>Consider All Angles<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-do-all-your-tools-features-provide-value\">Do all your tools\u2019 features provide value?<\/h3>\n\n\n\n<ul>\n<li>When comparing tools\u2019 TCO<strong>,<\/strong> look beyond a basic feature-by-feature comparison. You may get more immediate \u201cbang for your buck\u201d with certain products, but challenge yourself to consider if and how you will leverage premium features. Are they necessary and worth the additional cost?&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul>\n<li>Consider each product\u2019s long-term viability. Will it become redundant as you invest in more comprehensive platforms over time?&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul>\n<li>Don\u2019t forget to quantify elements like additional software to backfill features already included in an alternative. For example, if one directory solution offers built-in <a href=\"https:\/\/jumpcloud.com\/blog\/mfa-effectiveness\">multi-factor authentication (MFA)<\/a> that your company would use and the other option doesn\u2019t, include a separate MFA solution as part of the TCO of the option without MFA.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-have-you-accounted-for-risk-nbsp\">Have you accounted for risk?&nbsp;<\/h3>\n\n\n\n<p>TCO includes the costs of what it takes to acquire and maintain solutions, but it doesn\u2019t typically extend to the costs associated with the solutions\u2019 risk. Accounting for these risks adds context to your proposal, offering a deeper analysis and fuller picture of the environment. Sometimes, a solution that reduces risk may be worth a higher cost. Identifying these risks \u2014 and quantifying them where possible \u2014 helps justify a high-cost solution that reduces risk.<\/p>\n\n\n\n<ul>\n<li><strong><em>Example:<\/em><\/strong> On-premises infrastructure does not have an expense for 24\/7 monitoring; however, this leaves the infrastructure unmonitored for 16 hours a day. On the other hand, cloud services come with 24\/7 monitoring, which significantly reduces the risk of a breach.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-get-the-data-and-visuals-you-need\"><strong>Get the Data and Visuals You Need<\/strong><\/h2>\n\n\n\n<p>Most IT professionals aren\u2019t also mathematicians, writers, or designers, so developing a proposal might be a bit outside your comfort zone. That\u2019s okay! We\u2019ve designed a comprehensive template designed to help you calculate, summarize, and visualize the TCO data you need to both analyze and propose initiatives to leadership.&nbsp;<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/jumpcloud.com\/tco-calculation-template\">Download the TCO Calculator Template \u2192<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Learn how to get IT initiatives approved with these TCO tips and proposal best practices.<\/p>\n","protected":false},"author":144,"featured_media":66650,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_oasis_is_in_workflow":0,"_oasis_original":0,"_oasis_task_priority":"","inline_featured_image":false,"footnotes":""},"categories":[2753],"tags":[2757],"collection":[],"platform":[2745],"funnel_stage":[3015],"coauthors":[2532],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.9 (Yoast SEO v22.9) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Leveraging TCO to Justify an IT Proposal - JumpCloud<\/title>\n<meta name=\"description\" content=\"Learn how to get IT initiatives approved with these TCO tips and proposal best practices.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Leveraging TCO to Justify an IT Proposal\" \/>\n<meta property=\"og:description\" content=\"Learn how to get IT initiatives approved with these TCO tips and proposal best practices.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal\" \/>\n<meta property=\"og:site_name\" content=\"JumpCloud\" \/>\n<meta property=\"article:published_time\" content=\"2023-06-05T21:24:02+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-08-14T20:57:41+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/jumpcloud.com\/wp-content\/uploads\/2022\/08\/tco-proposal.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"900\" \/>\n\t<meta property=\"og:image:height\" content=\"600\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Kate Lake\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Kate Lake\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal#article\",\"isPartOf\":{\"@id\":\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal\"},\"author\":{\"name\":\"Kate Lake\",\"@id\":\"https:\/\/jumpcloud.com\/#\/schema\/person\/f8e192cbcdde7ffa4bc2f96c48ceda78\"},\"headline\":\"Leveraging TCO to Justify an IT Proposal\",\"datePublished\":\"2023-06-05T21:24:02+00:00\",\"dateModified\":\"2024-08-14T20:57:41+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal\"},\"wordCount\":1531,\"publisher\":{\"@id\":\"https:\/\/jumpcloud.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal#primaryimage\"},\"thumbnailUrl\":\"https:\/\/jumpcloud.com\/wp-content\/uploads\/2022\/08\/tco-proposal.jpg\",\"keywords\":[\"tco\"],\"articleSection\":[\"Unification\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal\",\"url\":\"https:\/\/jumpcloud.com\/blog\/tco-it-proposal\",\"name\":\"Leveraging TCO to Justify an IT Proposal - 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