Saving money

Here is a real life example, where a client produced these figures in his consideration of implementing a videoconferencing project.

The application:

A construction company, with 5 offices spread around the UK.

The main problems:

Directors would meet for Board meetings, both main Board and subsidiary, once a month. This could mean many individuals travelling a number of times per month. Meetings typically took two hours in duration.

The monthly costs of the meetings:

Direct Costs
Item Cost
Travel to meeting location - petrol costs etc £300
Subsistence £125


Indirect Costs
Item Cost
Lost productivity through travel, say £50 per hour per Director £1,000


Total Cost £1,425 per meeting
Monthly meeting cost £7,125


The Video Conference solution:

It was decided to hold two meetings each quarter by video, the third would be face to face as before, and become a quarterly review. This left the face to face meetings costing £2,375 per month.

Equipment Costs
Item Cost
Appliance based Video Conferencing solution for medium sized room with plasma screen and ability to share & display full XGA graphics. Price includes support & training. £50,000 (5 x £10,000)
2Mb SDSL lines - annual cost, albeit non dedicated use £18,000
Total Equipment Costs £68,000


Monthly Costs
Item Cost
Depreciation of Capital equipment over 4 years £1,042
SDSL monthly cost £1,500
Monthly Costs £2,542

MONTHLY SAVING of £2208 is achieved by replacing 2 out 3 meetings with Video Conferencing meetings. OR, PUT ANOTHER WAY, THE EQUIPMENT PAID FOR ITSELF IN LESS THAN 2 YEARS.

Not only savings... but also the Directors now find that they are able to be more productive.

  • Directors have a more beneficial work/life balance.
  • Meetings are more action based, more efficient and have a greater amount of decisions made.
  • More adhoc meetings take place in addition to action urgent needs rather than waiting for the monthly meeting. This creates competitive advantage.
  • The company is more environmentally friendly using less fuel for travelling.
  • Directors & employees are happier and less stressed.

AND IT COSTS LESS TO ACHIEVE ALL OF THIS THAN THE ALTERNATIVE SOLUTION - TRAVELLING!

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Glossary

If you're meeting by video, you're not travelling as much. Costs are reduced and savings are made as soon as you start meeting over video.
Videoconferencing is a live communication between people in separate locations. It usually involves audio and text as well as video. Videoconferencing in its simplest form transmits static images and text between two locations. Sophisticated video systems today can transmit full-motion video images and high-quality audio between multiple locations.
Video conferencing solutions comprise of everything you need to enable video communication between people in separate locations. Video conferencing systems can range from simple desk top systems for one-to-one video calls through to a sophisticated system, fully integrated into the design of your room for a video call between many people at a number of different locations.
Important to us all is the balance between our work and home. A video conferencing solution reduces the need to be away so often thus allowing more time with family and friends.