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Case Study: The ROI of Digital Video Surveillance

Allen Rude, security manager at Intel, invested more than four years in an ROI study to justify the cost of digital video surveillance

By Scott Berinato

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This gave him the time staff spent looking at tape over a full year at a small Intel site (100 cameras), a figure that could be easily adjusted for larger sites, those with, say, 500 cameras.

Still, dollars are what matter. Rude had to come up with an expense for all of this camera viewing. To do that he made one final determination: cost of an event per hour. He chose $50 per hour as the cost of dealing with video surveillance events. While it wasn't a perfectly scientific number, it wasn't a capricious one either. To arrive at the figure, Rude factored in the cost of paying staffers to go get the video, the cost of devoting investigation time and energy to an event (thus taking those away from other jobs), the cost of any related investigations coming out of the event, and other factors.

By multiplying his annual hours of viewing time for 100 cameras by $50 per hour, Rude arrived at his productivity benchmark: a full 33 percent savings by using digital video surveillance.

It's important to note that life expectancy of systems, maintenance and, most important, the capital expense of installing a new system were not factored in here. Rude's pilot was done to prove productivity gains once the system was installed. Now came the hard part for Rude: He had to prove that the large-scale capital investment and associated costs of maintaining digital video surveillance would save his company money on the bottom line.

Diversion:

2001 to 2004—The Battle with IT

One of Rude's greatest challenges as he sought to prove digital video surveillance's worth was remaking the relationship between his security group and the information technology department. Rude says it took three full years to get the two teams to support each other on this project, and to build what is now an excellent relationship. Still, recalling the early days of his DVR project, Rude sounds frustrated.

"The network for security was a 10Mbps shared network that we owned," says Rude. "We had to plan for a 100Mbps switched network for digital video surveillance. We spent years just getting IT to take ownership of the security network."

Another key point of contention was that the network upgrade would also have to stay out of the DVR project budget. IT was having none of it, because (Rude eventually discovered) they thought the security group wanted to stream live video from every camera on the network. Nearly a dozen meetings over the three years, and still no buy-in from IT. So Rude changed tacks.