Skip to content
Tiatra, LLCTiatra, LLC
Tiatra, LLC
Information Technology Solutions for Washington, DC Government Agencies
  • Home
  • About Us
  • Services
    • IT Engineering and Support
    • Software Development
    • Information Assurance and Testing
    • Project and Program Management
  • Clients & Partners
  • Careers
  • News
  • Contact
 
  • Home
  • About Us
  • Services
    • IT Engineering and Support
    • Software Development
    • Information Assurance and Testing
    • Project and Program Management
  • Clients & Partners
  • Careers
  • News
  • Contact

The new value calculator: Levers for business optimization

As we move further into the digital age, we continue to see a growing emphasis on data-driven decision-making. And as a result, there has been a surge in the development of new products, tools, and platforms competing to help businesses analyze and utilize more data, more effectively. Given the number of competing solutions along with new economic-driven constraints on capital in most industries, data executives need to be able to make a compelling business case for new investments in data and analytics solutions. One method of determining whether an investment is right for your organization is using a value calculator.

You may be familiar with the concept of a value calculator. It is a formula designed to help businesses assess the potential value of a new investment or initiative and typically has been used for ‘business investments’ such as a new marketing campaign, or building a new manufacturing plant. However, given the competition for capital or budget, this must also be applied to data and analytics spend. By using a simple equation, the value calculator provides a quantitative estimate of the potential return on investment (ROI) of a particular initiative. The calculation can be simplified as:

ROI = Net benefits / Cost

To keep it simple, if for example the cost of a new analytics tool is $1 million and the data team can run 5 projects this year on it, and the average project value is $1 million, the net benefit would be $4 million for an ROI of 400% in the first year. Given this, the company may be sure they’ve made a smart investment. However, this model doesn’t look at the whole picture – it’s overly simplistic and not flexible enough for the way we do business these days. What if customized coding is required to integrate the new tool? What if the difference in security and governance requires additional system administrators? What if this creates a new data silo, etc.?

What is needed is a holistic model that balances multiple factors – for instance, while money is obviously still important, it’s not all about the short-term impact on the bottom line. Resilience, risk reduction, and especially business agility are very important too. After all, projects or use cases will continue to pop up that we can’t possibly predict, and the future flexibility to move quickly on these use cases will be a business game changer.

The new value calculator looks less like an equation and more like weights balanced on a scale.

Business Case Chart

Cloudera

“Customers do not buy solely on low price. They buy according to customer value, that is, the difference between the benefits a company gives customers and the price it charges. More precisely, customer value equals customer perceived benefits minus customer perceived price,” said McKinsey & Company.

While cost is still a key factor, the new model asserts that it’s not always the better option to get the tool at the lowest price. Value is all about the cost/benefit analysis. This model considers hidden costs not included in the price tag, like risk, implementation costs, infrastructure costs, security costs, organizational changes, vendor lock-in, and the cost of doing nothing at all.

To get the maximum value, it’s a far better strategy to maximize the number of use cases you can get out of a tool rather than considering the first use case as a standalone. For instance, can your potential tool work for both cloud and on-prem data? Is the tool limited to a specific type of data? Can the datasets or source of data be easily expanded?

Data executives have to balance two disparate goals, manage cost but increase the usability of data, thereby maximizing the value creation potential of a company’s data assets. To achieve these goals, we’ve found that it’s exponentially more valuable to work on a hybrid data platform. The idea of workload portability is that we can dynamically manage workloads where they are best suited, rather than following the recent trend of heading straight for the cloud.

And your options come with different price tags, so it may be more effective – not just for cost but also process, computing power, etc. – to run part of your workload on GCP and part on AWS, for example. And keep some of your workloads on premises where they are handled best.

Cloudera is uniquely positioned to do this effectively as the only hybrid data platform to help you manage data anywhere – on-prem and in any cloud – across the full data lifecycle. Meaning your modern data infrastructure can efficiently run workloads on-prem, in a private cloud, or public cloud without any hiccups – and move between them if and when your circumstances change.

We at Cloudera know that our solutions enable our clients to generate significant value, transform their competitive position, etc. As such, this value approach is baked into how we are taking Cloudera’s new products to market. Rather than endeavoring to be the lowest-priced option on the market, we show our customers how they can get the maximum value out of our tool by uncovering its many potential use cases within an organization. We know value is unique to each customer situation and their needs.

It’s a balancing act.

Learn more about CDP.

Data Management
Read More from This Article:
The new value calculator: Levers for business optimization
Source: News

Category: NewsJune 6, 2023
Tags: art

Post navigation

PreviousPrevious post:From edge to cloud: The critical role of hardware in AI applicationsNextNext post:The new wave of data observability

Related posts

Barb Wixom and MIT CISR on managing data like a product
May 30, 2025
Avery Dennison takes culture-first approach to AI transformation
May 30, 2025
The agentic AI assist Stanford University cancer care staff needed
May 30, 2025
Los desafíos de la era de la ‘IA en todas partes’, a fondo en Data & AI Summit 2025
May 30, 2025
“AI 비서가 팀 단위로 지원하는 효과”···퍼플렉시티, AI 프로젝트 10분 완성 도구 ‘랩스’ 출시
May 30, 2025
“ROI는 어디에?” AI 도입을 재고하게 만드는 실패 사례
May 30, 2025
Recent Posts
  • Barb Wixom and MIT CISR on managing data like a product
  • Avery Dennison takes culture-first approach to AI transformation
  • The agentic AI assist Stanford University cancer care staff needed
  • Los desafíos de la era de la ‘IA en todas partes’, a fondo en Data & AI Summit 2025
  • “AI 비서가 팀 단위로 지원하는 효과”···퍼플렉시티, AI 프로젝트 10분 완성 도구 ‘랩스’ 출시
Recent Comments
    Archives
    • May 2025
    • April 2025
    • March 2025
    • February 2025
    • January 2025
    • December 2024
    • November 2024
    • October 2024
    • September 2024
    • August 2024
    • July 2024
    • June 2024
    • May 2024
    • April 2024
    • March 2024
    • February 2024
    • January 2024
    • December 2023
    • November 2023
    • October 2023
    • September 2023
    • August 2023
    • July 2023
    • June 2023
    • May 2023
    • April 2023
    • March 2023
    • February 2023
    • January 2023
    • December 2022
    • November 2022
    • October 2022
    • September 2022
    • August 2022
    • July 2022
    • June 2022
    • May 2022
    • April 2022
    • March 2022
    • February 2022
    • January 2022
    • December 2021
    • November 2021
    • October 2021
    • September 2021
    • August 2021
    • July 2021
    • June 2021
    • May 2021
    • April 2021
    • March 2021
    • February 2021
    • January 2021
    • December 2020
    • November 2020
    • October 2020
    • September 2020
    • August 2020
    • July 2020
    • June 2020
    • May 2020
    • April 2020
    • January 2020
    • December 2019
    • November 2019
    • October 2019
    • September 2019
    • August 2019
    • July 2019
    • June 2019
    • May 2019
    • April 2019
    • March 2019
    • February 2019
    • January 2019
    • December 2018
    • November 2018
    • October 2018
    • September 2018
    • August 2018
    • July 2018
    • June 2018
    • May 2018
    • April 2018
    • March 2018
    • February 2018
    • January 2018
    • December 2017
    • November 2017
    • October 2017
    • September 2017
    • August 2017
    • July 2017
    • June 2017
    • May 2017
    • April 2017
    • March 2017
    • February 2017
    • January 2017
    Categories
    • News
    Meta
    • Log in
    • Entries feed
    • Comments feed
    • WordPress.org
    Tiatra LLC.

    Tiatra, LLC, based in the Washington, DC metropolitan area, proudly serves federal government agencies, organizations that work with the government and other commercial businesses and organizations. Tiatra specializes in a broad range of information technology (IT) development and management services incorporating solid engineering, attention to client needs, and meeting or exceeding any security parameters required. Our small yet innovative company is structured with a full complement of the necessary technical experts, working with hands-on management, to provide a high level of service and competitive pricing for your systems and engineering requirements.

    Find us on:

    FacebookTwitterLinkedin

    Submitclear

    Tiatra, LLC
    Copyright 2016. All rights reserved.