Tag Archives: Video Conferences
As organizations continue to deploy video conferencing units in a wider variety of conference rooms there is a desire to install systems that are standalone endpoints, which don’t require the need to invest and deploy a cumbersome in-house infrastructure. Additionally these server independent units provide flexibility, immediacy and portability.
Even though there is a growing trend to desktop and mobile video conferencing, there is still significant demand to conduct conferences in pre-set rooms or executive offices equipped with dedicated devices with higher quality audio systems and cameras.
Standalone video systems can be used to host small conferences with their embedded MCU (multipoint control unit) and provide recording and basic streaming services. When needed, these systems can use cloud services for better reach and capacity for both B2B (business-to business) and B2C (business- to- consumer) use cases.
The concept of standalone endpoints marries well with the BYOD (bring your own device) trend and can reduce cost and complexity for SMB (small/medium businesses) and secondary sites for larger organizations.
In the earlier days of video conferencing many room systems were large and unwieldy appliances with complex user interfaces. This resulted in video conferencing being cumbersome and not user friendly. The appliance was eliminated from room based systems when video conferencing set top boxes were introduced. These units were easier to install and sat on top of a television monitor. Eventually there was a drive to PC-based systems with self contained codecs that worked with web cams. Software based video conferencing products were bundled with a camera and microphones.
Standalone video endpoints were initially designed to sit on the desktop for personal participation in a video call. Today these standalone video endpoints are useful in any room, on any desktop and as a mobile app. for a variety of B2B and B2C applications.
The technology has evolved from large, cumbersome systems to systems that are stand-alone and portable with all functionality bundled into the system. This evolution now makes it possible to install self-contained, full-featured video conferencing systems wherever they are needed.
Standalone video endpoints are inexpensive and easy to set up. They provide flexibility and allow for instantaneous meetings in the office or away from work (mobile and serverless), since the technology is easy to install and inexpensive enough to allow installation at secondary sites (i.e. home and smaller office sites). Users like the immediacy of the technology and are using these units for a variety of applications. No longer is there worry about cumbersome in-house infrastructure or the need for a multipoint control unit.
Until the advent of self-contained systems, organizations wishing to connect more than two sites together had to use a multipoint control unit (MCU) to make these connections. Standalone systems now have an MCU embedded in them, thus reducing the complexity and cost of using an external MCU and avoiding firewall issues.
Additionally, these units offer the value of recording and basic streaming services so information from meetings can be saved and others, at a distance, can view the meeting either as it happens or afterwards.
We’ll continue our discussion of the value of standalone video endpoints in our blog next week. In the meantime, what are your thoughts about Video endpoints? What value does it add to your clients? We’d love to read your thoughts in our comments section.
Last week, we discussed how the use of video conferencing has the potential of increasing productivity and efficiency by reducing unproductive travel time, preventing meeting delays, creating shorter & more structured meetings, and providing faster exchange of information. With video conferencing, and the data collaboration tools that are now used with it, individuals can get information when it is easiest for them, on a real-time or delayed basis. By increasing usage of video conferencing, organizations will quickly see a financial return on investment. This is part two of our series on driving video conferencing ROI. Part one can be found here.
Return On Investment
Understanding the value obtained by implementing video conferencing helps management understand why video conferencing should be viewed as a necessity, not just a nicety. While many view the benefits of video conferencing to be measured with soft dollars, in reality those who have identified useful applications have had no trouble developing a return on investment to justify both their initial capital expenditures and their ongoing recurring costs. By calculating a return on investment it is easier for management to see the value of video conferencing and, thus, understand the need to continue growing the use of the technology. Without understanding this value what often happens is that when one champion of the technology departs another is not easily found. When value is understood everyone wises to claim the deployment and usage of video conferencing as their idea!
Types of return on investment (ROI) calculations for video conferencing include travel cost savings, increased productivity, and time efficiency.
Travel Cost Savings
Using video conferencing can reduce travel costs. By using video, trips can be avoided, thus saving the cost of travel. For example, one company found they achieved a return on investment after only 67 days because they paid for their equipment by not traveling.
By increasing productivity an organization can improve their response time to market or the time it takes to handle repairs. A package goods company used video conferencing to increase productivity enabling them to get a product to market three months sooner, which resulted in productivity & cost savings of millions of dollars. The sooner they get their products to market, the greater the revenue.
Business Case Example
Using video conferencing to squeeze more hours into a day allowed one organization to accomplish more in a shorter time period. This improved time efficiency resulted in more business being accomplished and improved the bottom line impact for the firm.
Following is a sample business case formula for calculating the return on investment for video conferencing. This formula can be used in its entirety or broken apart, depending on the application requiring justification.
Videoconferencing Cost Justification Explanation of Categories and Formulas
A. The number of meetings held during the course of a year that could be displaced by videoconferencing is generally 20 to 50 percent.
B. Estimate the overall average meeting length. Videoconferences tend to be 20 to 30 percent shorter than in-person meetings.
C. Estimate the overall average number of attendees at a meeting. Videoconferences range from two to 20, but the average is four to six participants.
D. The number of meeting attendees who travel – usually 50 percent of the total number of participants.
E. Based on an overall annual remuneration of $60,000 (including bonuses) for the average attendee, add 30 percent overhead for benefits and divide by 1,900 hours worked per year. The average hourly compensation is $40 / hour.
F. Multiply the number of meetings by meeting length by average number of attendees by average wage per hour (A*B*C*E).
A. The total trips between two sites being analyzed (number of travelers * the number meetings or A*D).
B. Total travel costs including ground travel (personal mileage, rental car, taxi), airfare, meals and lodging.
C. Multiply number of roundtrips by the average cost per roundtrip (G*H).
A. The average length of time it takes a traveler to travel to and from the remote site.
B. The inverse of the time a traveler is actively pursuing work-related activities while traveling. If a traveler works 50 percent of the time, the traveler is non-productive 50 percent of the time.
C. Same as the average attendee wage (E).
D. Total trips between the two sites being analyzed (G).
E. Multiply the average travel time by the percent non-productive travel time by average traveler wage per hour by number of roundtrips (J*K*L*M).
A. Multiply number of meetings displaced by the videoconference meeting length (A*B).
B. Based on average facility / equipment costs of $100,000; a 50 percent utilization factor (4 hours per day); and with capital costs amortized over 5 years (includes accepted depreciation standards) – the cost per hour of one videoconferencing room is about $20 per hour (2 rooms are required).
C. Average cost per hour of usage is $75.
D. Add equipment / facility costs and transmission costs (P+Q).
A. Add annual meeting costs, annual travel costs and cost of non-productive time (F+I+N).
B. Add annual meeting costs and annual videoconferencing costs (F+R).
C. Subtract the cost of videoconferencing meetings from the cost of displaced conventional meetings (S-T).
Expanded Video Applications
Video conferencing technology provides a powerful communications tool. There are many ways to make the most out of the technology. It is not just a meeting tool. Once the equipment is in place, video conferencing can be used as a production facility. Use video conferencing equipment to record content, stream information to many, produce information, and create “webinars”.
Video conferencing sessions can be recorded for playback at a later date. This feature is useful for individuals unable to make the meeting or for archiving information to be viewed at a later date.
Meeting information can be sent (streamed) over existing networks to multiple sites, allowing them to view the meeting real time and not leave their work locations. This allows for increased meeting participation from those at a distance.
Video conferencing technology can be used as a production facility to produce content to be disseminated to employees and customers. The information produced can be archived for retrieval at a later date or streamed to individuals as needed. Save time with HR training by using video conferencing equipment to present and record company policies. Create a special CEO message and send it out to all employees.
Video conferencing systems can be utilized to create events over the web where the video, the audio and the content are shared with distant participants. Known as “webinars”, these events are often used to share information given by a subject matter expert or to provide training.
Video Conferencing Applications
The four top applications why video conferencing is installed are: management meetings, sales & marketing meetings, for engineering, manufacturing or production, and for training. This does not preclude other groups from using the technology (i.e. the HR department, the legal department, and finance), but studies conducted by TRI have shown the primary reasons why firms install video conferencing relate to the top four applications noted above.
Additionally, video conferencing has been used for a variety of other applications including product demonstrations to new customers, “townhall” type meetings and HR training. Given the longevity of video conferencing usage, all industries have developed useful applications for video conferencing. It is no longer a matter of if you will use video conferencing, it is only a matter of when. Make your video conferencing system work for you to get your message to everyone, internally and externally.
The future of video conferencing is bright. Dynamic changes in the global communications environment – decreasing network & equipment costs and the need for businesses to compete in a global economy – will help propel the adoption and usage of video conferencing at a rapid rate. It is important for organizations to develop a plan to efficiently and effectively measure the ROI for video conferencing to ensure its successful and ongoing usage.
Users need to the get benefit of quality technology that works flawlessly, is easy to use, and designed to meet ongoing needs. Management wants to quantify cost savings and feel the technology is positively impacting the bottom line.
S. Ann Earon, Ph.D., is president of Telemanagement Resources International Inc. and Founding Chairperson of IMCCA, the non-profit industry association for collaborative conferencing. She can be reached via email at firstname.lastname@example.org.
Download the full whitepaper “DRIVING VIDEO CONFERENCING ROI” here