An industry anew

Onto the buzz words!!
This is mostly digested from the Virtual Infrastructure Yields Real TCO and ROI Advantages paper from the SAPinsder (link at the bottom).
SAP - Systems, applications, and products. Originally developed by 5 IBM employees in 1972, the idea was to provide multiple enterprise applications with a common database structure. SAP's latest software is called R/3, but has since been adapted by a host of other companies (Microsoft for instance). Now it provides the standard for Customer Relations Management (CRM) and Supply Chain Management (SCM).

Why is this good for CFOs?
1. You can do more with less.
SAP typically involves LOTS of server hardware to be depreciated (more on that later), LOTS of server operating systems. This means physical space, power, cooling, IT staff to support it all. It also means new and expensive server hardware to meet the software requirements.
VMware allows you to consolidate those diverse system into an efficient, compact system. Our own experience has shown around 5 to 1, or even higher physical to virtual server consolidation. That means:
a. Less physical space
b. Less power consumption
c. Avoids the new to purchase as much new equipment

Problems
ROI and TCO are notoriously difficult to quantify, particularly when it comes to technology infrastructure. With so many intangibles, indirect costs, and "soft-dollar" considerations (SHUDDER!!! BUZZ WORD - means your company pays fees to a brokerage, which pays hard dollars for the computer equipment you're going to use. See link 2).
We need a detailed and objective approach to ROI and TCO that can be applied by companies of all types and sizes, in any industry sector, for any number of concurrent connections. This is detailed in the white paper "TCO and ROI Analysis of SAP Landscapes Using VMware Technology".
No two companies are alike in the size, scope, and objectives of their technology infrastructure. This diversity means that opportunities for cutting costs and improving productivity through VMware vSphere are likewise diverse. It also means that calculating TCO and ROI requires consideration of a range of variables, such as business risk and high availability.
The above white paper takes a look at four major categories and assesses their contribution to ROI and TCO.
10% Administration (asset management, firmware upgrades, and training)
20% Hardware and Software
30% Downtime (planned or unplanned that affects users)
40% Operation (support, energy costs, scheduled downtime, process and planning)
These are further broken down into direct (budgeted) costs (capital, fees, and labor costs), and indirect (unbudgeted) costs. This measures IT's efficiency at delivering expected services to end users.

The three diverse companies of 400, 200, and 100 users, featured in the white paper, cut their IT infrastructure's TCO by a range of 49% to 83% over 3 years.

1. http://www.google.com/url?sa=t&source=web&cd=1&ved=0CBMQFjAA&url=http%3A%2F%2Fwww.vmware.com%2Ffiles%2Fpdf%2Fpartners%2Fsap%2Fvmware-sap-virtualization-tco-roi-article-en.pdf&rct=j&q=vmware%20roi%20for%20the%20cfo&ei=Jf3ZTPCeEqbfnQf2-8ycCg&usg=AFQjCNF5H4-kmOe2_KsIYogsAFYBBD16jQ&cad=rja

2. http://www.hewittinvest.com/pdf/SpotlightOn_Jul04.pdf

3. VMware's TCO and ROI calculator. A truely best case scenario.
http://roitco.vmware.com/vmw/ServerVirtualization/Index

4, Vmware's Cost per Application calculator
http://www.vmware.com/technology/whyvmware/calculator/index.php