This is the third in a series of blog posts about how Microsoft Payment Solutions is designed to help companies achieve their strategic objectives through thoughtful cash flow management.
Companies who are about to embark on large-scale IT projects that may span months or years before they come online often balk at the prospect of having to pay for the software and services upfront.
These companies understand the opportunity cost associated with tying up their capital in a large upfront investment long before the project delivers any value.
Whether your organization is deploying a new customer-facing website, rolling out an Enterprise Resource Planning (ERP) system or building out your data center, Microsoft Payment Solutions offers real solutions that help you manage your cash flow more effectively over the life of the project.
How does it work? Let’s assume, for example, that your company wants to roll out a new ERP system worldwide to manage all key business operations. Your CIO wants to use Microsoft Services to drive down the development and deployment time for faster ROI. To get this completed, your company will need to invest $4 million in software and $1 million in services.
As the CFO, you know that there are other strategic projects that need funding in the next two or three years that will be starved if you spend most of your budget up front.
With Microsoft Payment Solutions, you have a powerful tool that allows you to manage your cash flow more strategically over the life of the project and avoid a large upfront payment. With the ramped payment option, you can map payments closely with deployment and usage by making smaller payments in years one and two and larger payments in year three when the project comes on line. Integration, deployment and support services from Microsoft Services can be included with your software expense so that you have one payment plan that covers both.
This means that in year one you only pay a portion of the total project cost of $5 million, which frees up your budget for other projects.
Ramped payments are only one of the payment options available to help your organization get the technology you need using the budget you have. This is how it works:
Ramped payment option – You can match payments to your available budget in the near term, and then cover the increased premium in later periods when additional funds are available