A Guide to Enterprise Collaboration Costs


Share on LinkedIn

One of the common questions that business leaders want to know is what kind of an investment needs to be made in collaboration. In other words, what sort of a budget should they be planning for and where should this money be coming from? It seems that this topic isn’t as widely addressed as it ought to be. I can’t tell you what the costs are going to be because there are a lot variables that go into this and each company is going to have different needs. However, I can at least try to help further the discussion that your team should be having by taking a look at some of the items and variables that you should consider. It’s easy to get carried away and right a massive article on this but I wanted to try to keep things as simple as possible.

It makes sense to break down collaboration budgets into a few buckets: technology costs and business/people costs.

Technology costs

Any organization that deploys collaboration tools is clearly going to have a technology cost associated with the deployment, however there are a few things that need to be included in the this bucket:

  • Seats/licenses (the cost will be different and might include hardware costs if you go with on-premise vs cloud based)
    • How many employees will be using the platform? (Typically discounts are offered for a larger number)
  • Maintenance and upgrade costs
    • Costs associated with things such as new versions of the product, patches, fixes, and the like (can typically be seen as a percentage of the license costs of around 10-20%)
  • Features and capabilities
    • This doesn’t apply to all vendors but many of them charge more for additional features and capabilities, chances are the more things you want the more you will have to pay
  • Integration costs
    • Typically development costs associated with either purchasing integration plug-ins or developing integrations between multiple platforms, oftentimes seen between existing legacy platforms and new collaboration platforms
  • Customization costs (including design)
    • Costs typically associated with custom design, development, feature, or functionality of the platform
  • Support costs
    • Associated costs with things such as if something breaks or doesn’t work, or if you need technical or professional services help (again sometimes offered a percentage of license costs of around 10-20% or a la carte).
These are typically the main things we see around technology costs when deploying a collaborative platform.

Business and people costs

  • Education and training
    • Costs associated with programs that your company will put in place to help educate and teach employees how and why they should use whatever it is you deploy. For example you might create a series of training videos, create an interactive employee manual, or conduct workshops
  • Internal marketing and promotion
    • This can be a pretty broad bucket but includes everything that would fall under marketing and promotion, for example lets say you wanted to print out a thousand t-shirts to give your employees or in the case of Yum! Brands, let’s say you wanted to give all of your employees “welcome kits!”
  • Staff
    • Oftentimes organizations bring on community managers, collaboration directors, or other new personnel to help lead this initiatives (or they transfer someone from an existing role)
  • Initial productivity costs
    • Although this is not something I have seen very often it’s still an issue that some organizations are concerned with and deals with a temporary decrease in productivity as employees learn how to use new tools, not all companies experience this but some companies I have spoken with have
  • Time
    • I included this in here because it’s a bit of a misconstrued topic. Oftentimes I will hear employees say things such as “I don’t have the time to use new tools” but the reality here is that these tools help save time not take up more of it

So where does the budget actually come from to make these initiatives happen? Honestly they have come from all over the map! Some companies like Penn State University canceled their in-person annual conference (which could only accommodate 1/3rd of employees) and used the budget to invest in collaborative tools and strategies. Other companies such as Oce, shifted their budgets from their existing traditional intranet into their collaboration efforts. Other companies use funds from corporate communications, HR, or innovation departments and some companies have a “special projects” bucket that they use to fund these projects.

The common thread for all companies though is that they all find money to make collaboration happen, it exists with your company you just need to figure out where. All-in-all I haven’t run into many companies who come to me and say “you know, this is a priority for us but we just don’t have the money to make it happen,” actually I can’t think of any companies off the top of my head who have ever told me that.

This should be a starting point for your enterprise collaboration budget discussions that will lead you to have a better understanding of what is included and more importantly what your organization needs around each of these areas.

Republished with author's permission from original post.

Jacob Morgan
I'm a best-selling author, keynote speaker, and futurist who explores what the future of work is going to look like and how to create great experiences so that employees actually want to show up to work. I've written three best-selling books which are: The Employee Experience Advantage (2017), The Future of Work (2014), and The Collaborative Organization (2012).


Please use comments to add value to the discussion. Maximum one link to an educational blog post or article. We will NOT PUBLISH brief comments like "good post," comments that mainly promote links, or comments with links to companies, products, or services.

Please enter your comment!
Please enter your name here