ACME Real Estate (ARE) provides real estate services including property sales, leasing, and management; corporate services, facilities, and project management; mortgage banking; investment management and capital markets; appraisal and valuation; and research and consulting. Headquartered in Denver, ARE has nearly 1,000 employees in more than 25 offices in the western US and 2 other countries. The company reported net revenues of $500 million in 2018.

The challenge

Having an up-to-date Web site and social media strategy are critical to accurately promoting ARE, its vertical service lines, and its international network of real estate professionals. In addition to providing corporate information, research data, and client tools, the site promotes the services of its 25 offices with dedicated Web pages. Personal profiles for each real estate professional and manager, individual sites for teams, and case studies are available for each location.

The company had decided on a locally hosted cloud-based content model for its corporate Web site, which was most recently updated in 2015 using another content publishing solution. The software had to be installed on each Web publishers computer and proved to be incompatible with the companys Microsoft Office environment, causing frequent crashes when users tried to load images or attachments. Users were unable to use the work- flow component provided, making approval tracking time and labor intensive. Urgent needs for content changes were often requested through phone calls and e-mails to Web managers. Because new pages could not be previewed before publication, all content had to be reviewed and edited manually after publication, and often pages were approved in error.

ARE needed a stable platform that could accelerate the review, approval, and publishing process while maintaining control over the sites design and formatting. It also needed to enhance the sites internal search feature, be able to monitor Web site analytics, and ensure the site was indexed by Web crawlers and search engines so it would be returned prominently in response to searches.

The strategy

The company considered separate vendors to supply document management and publishing technologies but chose the Microsoft Cloud-based Web Content Management within Azure for both the external Web site and its intranet. Critical to AREs decision was Microsofts ability to offer rapid and efficient transfer of 8,000 pages of existing content to the new software templates the company could not afford for the site to be down for content conversion.

ARE used Microsoft consultants to transfer the existing content, to provide customized templates and a new workflow process to support training. Two members of AREs IT staff attended training in Redmond, and a Microsoft consultant was used on site to train additional trainers the corporate Web staff and two divisional Web managers. These Web managers quickly rolled out training to the 18 offices in the United States during a 2-week period, and followed up with regional support calls and an intranet page for Web publishers that supplied manuals, FAQs, and style guides.

Key benefit areas

Deploying Microsoft Content Management Server to support its corporate Web site has enabled ARE to improve the quality and quantity of information on the site while reducing the time needed for content review and publishing. Key benefits it achieved include the following:

• Reduced administrative overhead. Customized and automated workflow and Web-based data entry reduced the need for a dedicated administrator to manage international content by allowing publishers in international offices to create and maintain their own content (installing the previous unstable software on computers in overseas offices was not an option).
• Increased IT staff productivity. Moving to a more stable content management system and a cloud-based environment reduced system crashes and downtime and enabled IT staff to focus on other value-added projects.
• Increased Web manager productivity. Reduced time spent reviewing, approving, and declining Web content allowed for greater time to enhance site features.
• Increased Web publisher productivity. The performance, speed, and simplicity of the new software motivated Web publishers to produce content. Because they were able to preview pages, they focused on quality and reduced the amount of time spent submitting and revising content for the Web editors.
• Reduced recruiting efforts for publishers. The systems ease of use and limited training demands made it easier to recruit Web publishers, who perform the role as part of their existing duties without additional compensation.
• Increased security and access. Compatibility with Web crawlers and more effective internal search tools supported by the MCMS based site better enable those accessing the site to find information they need yet providing better internal and external security.

Key cost areas

Personnel made up the greatest portion of the companys investment in Microsoft Content Management Server, amounting to 48% of the 3-year cost of the project. Other cost areas included software, hardware, consulting, and training.

Lessons Learned

Using a stable environment has helped ARE to recruit more publishers, motivate internal users, and reduce frustration for IT and Web services staff while improving site functionality and usability. A better user experience should increase the number of return visitors to the site.

Calculating the ROl

Three main benefit areas were quantified in calculating the ROI from AREs investment in the Microsoft Content Management Server: reduced administrative overhead, increased IT staff productivity, increased general employee productivity, and improved customer satisfaction. One person responsible for managing international content was eliminated, reducing administrative overhead. IT and general employee productivity savings were calculated based on the fully-loaded employee cost. ARE calculated IT and general employee time savings associated with the new content management solution and compared them to the former one. Customer satisfaction was captured in a post-web use survey.

Assumptions: 15% discount rate

Case Questions

1. Calculate the following:
   1. Annual ROI
   2. Total Cost of ownership
   3. Average annual cost of ownership
   4. Net present value in year 3
   5. Payback period
2. Would you make the investment? Discuss.
3. Categorize the benefits described in the case as either direct or indirect benefits. Discuss the challenges associated with quantifying indirect benefits in IT and how realistic you believe these estimates to be. What does this mean for your estimated ROI calculation?
4. Why is it important to calculate total cost of ownership? What about IT TCO is problematic?
5. Discuss how ARE captured the indirect savings numbers. What do think of this approach?
6. How would you pitch this case to management?

The Numbers Initial Yn Yr2 Yr3 Scenario 1 Annual Benefits Direct Indirect Total Benefits per period 26,000 2,279,729 2,305,729 26,000 2,279,729 2,305,729 26,000 2,279,729 2,305,729 . Y12 Yr3 Depreciation Schedule Software Hardware Total Depreciation per period Acquisition lyri 200,000 24,000 224,000 40,000 5,000 45,000 40,000 5,000 45,000 40,000 5,000 45,000 Initial Yr Yr2 Vr3 30,000 5,000 30,000 5,000 30,000 5,000 Expensed Costs Software Hardware Consulting Personnel Training Other Total Costs per period 45,000 64,000 20,981 100,000 100,000 100,000 129,981 135,000 135,000 135,000 The Numbers Initial Yn Yr2 Yr3 Scenario 1 Annual Benefits Direct Indirect Total Benefits per period 26,000 2,279,729 2,305,729 26,000 2,279,729 2,305,729 26,000 2,279,729 2,305,729 . Y12 Yr3 Depreciation Schedule Software Hardware Total Depreciation per period Acquisition lyri 200,000 24,000 224,000 40,000 5,000 45,000 40,000 5,000 45,000 40,000 5,000 45,000 Initial Yr Yr2 Vr3 30,000 5,000 30,000 5,000 30,000 5,000 Expensed Costs Software Hardware Consulting Personnel Training Other Total Costs per period 45,000 64,000 20,981 100,000 100,000 100,000 129,981 135,000 135,000 135,000