Why Real-World ROI Matters to Software Vendors Pursuing FedRAMP in 2021

Even before the COVID-19 pandemic, there was a growing trend and transformation of enterprises and government agencies moving applications to the cloud. We’ve seen that trend accelerate dramatically as organizations have scrambled to ensure their workers have access to the necessary technology and software needed for increased telework all while pivoting their business for new growth opportunities. In today’s economy, many independent software vendors will find new business growth in the public sector marketplace in 2021. But that also requires making their cloud-based applications compliant with the Federal Risk Authorization Management Program (FedRAMP).

For those software vendors working to achieve FedRAMP compliance, the company that can get to market and seize new business the fastest — with the right software — wins. The right software for federal buyers doesn’t just need to be fully functional, it also needs to be secure and compliant with the complex and comprehensive FedRAMP standards and regulations.

As cloud-based software vendors work to ensure that they’ll be in a position to be considered for Federal 2021 bids and Request for Proposals (RFPs), time-to-market, and time-to-revenue matter. They matter A LOT. The cost of delay in taking too long to achieve FedRAMP certification and authority to operate (ATO) is the difference between seizing new business growth opportunities or losing those business growth opportunities.

This is where many enterprises fall short when moving software applications to the government cloud on AWS or Azure in order to seize new public sector business opportunities. Many may not realize that when using a legacy consulting services approach, deploying a full set of cloud-based security controls and documenting compliance for FedRAMP Moderate can take 18-24 months or more at a cost of up to $2 million. That’s up to two years of costly delays, operational expenses, and lost opportunities to gain new revenue and market share.

Understanding how much time it does take, how much it really costs, and what these factors mean to your Return on Investment (ROI) for FedRAMP projects is a critical first step on your journey toward achieving FedRAMP certification in 2021.

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At Anitian, we’ve reinvented the way ISV’s, Federal System Integrators, and federal agencies are achieving — and maintaining — FedRAMP security and compliance. As the world’s only pre-engineered Compliance Automation Platform on AWS and Azure, we deliver a new generation of automation that’s helping our customers get their applications to the federal market up to 80% faster and at 50% of the cost of traditional DIY and consulting service approaches.

We recently launched a real-world ROI calculator designed to help customers and prospects gain valuable insight into the time and money they can save on their FedRAMP project with Anitian. The calculator gives a realistic overview of the costs, time-to-compliance, potential savings, and incremental revenue opportunities they can achieve when they leverage Anitian’s pre-engineered and automated platform rather than traditional consulting services. Note that ROI figures shown represent a typical project for FedRAMP Moderate and certain SLA assumptions and conditions apply.

ROI is typically thought of as a calculation of how and when you can get your money back on money spent. However, when it comes to FedRAMP, having real-world ROI insight can be the difference between choosing a potentially disastrous and delayed FedRAMP journey, or choosing a successful and accelerated FedRAMP journey.

The side-by-side numbers in the infographic below don’t lie. We’ve compiled and presented them here using actual, real-world customer case studies. Chances are that, if you’re in the process of kicking off a strategic FedRAMP project in 2021, the numbers may seem a bit incredible. Don’t believe us? Most of our customers — including large enterprise customers — didn’t either. Until we delivered the fastest path to revenue and compliance for their business.

As the graphic outlines, there’s a better way of achieving FedRAMP compliance and business growth. A way that slashes cost, significantly shortens the scope of the project, and even offsets ongoing costs of maintaining FedRAMP compliance. This new approach even allows you to realize incremental FedRAMP revenue as much as a year and a half earlier. Let’s break it all down, looking at a typical FedRAMP Moderate project.

1.) Cost Comparison

The cost to prepare for a FedRAMP Moderate audit can be surprisingly high. With traditional approaches, the price tag is in the millions of dollars. It’s best to look at all of the costs involved and broken down, so software vendors can make good decisions:

• Advisory Services costs
• 3PAO (3rd Party Assessment Organization) costs
• Consulting & Training Services
• Software Licensing
• Software Vendor Selection and Administration
• 24×7 Security Operations

Combining all these costs, you’ll see that the Consulting Services approach has a price tag of over $1.7M which is over 2x the cost of achieving FedRAMP with Anitian’s pre-engineered Compliance Automation Platform on AWS and Azure.

2.) Time-to-FedRAMP

Let’s look at the time to achieve FedRAMP compliance, which has a direct impact on time-to-market and time-to-revenue. To be able to sell to the Federal government, you must first pass a FedRAMP audit by an accredited 3PAO assessor. The cost of a FedRAMP 3PAO audit is generally the same regardless of which path you choose. The key difference, however, is the time it takes to get ready for that audit. And, what you do to achieve audit-readiness can have a significant impact on the success and duration of your audit.

With the consulting services approach, the time to become audit-ready is typically a 12 to 18-month journey (most often closer to 18 months). With Compliance Automation, the time to become FedRAMP audit-ready can be reduced to as little as 60 days. That’s 80% less time! Think about how it might feel to get to market and revenue over a year earlier than your competition.

3.) Savings Over Two Years

Now let’s look at total cost of ownership (TCO) savings over a two-year timeframe. We’ve done the math for you and taken real-world examples to measure what savings you’d realize over two years with the Anitian approach. If you look at the consulting services costs over two years, FedRAMP costs run about $2.8M compared to Anitian’s costs of around $1.04M. The difference is surprising. A cost savings of approximately $1.7M over two years is significant for your total ROI calculation.

4.) Incremental Revenue

The advantages of getting your product to market, and revenue, faster cannot be understated. And if you compare the incremental revenue opportunity, things start to get real. We’ve made some assumptions of a typical cloud-based software product sold to the federal marketplace and extrapolated revenue over a period of time vs. vendors taking the consulting services approach. We assumed two deals at $75K each over two years from the time a FedRAMP project begins. With Anitian, you can grab $900K in incremental revenue over a 6-quarter period by getting to market as quickly as Q3 of the first year. With the consulting services approach, incremental revenue drops to just $300K due to the delay of market-readiness until Q7 of the second year.

What Matters Most

The reduced initial costs, decreased time to become FedRAMP audit-ready, reduced total costs over time, and the increased incremental revenue that Anitian brings to the table all add up to value never achievable before. However, what really matters is time-to-market and time-to-revenue for your business. With Anitian, you’ll get to market and revenue dramatically faster while eliminating the cost of delay.

Don’t believe us? Try it for yourself. Schedule a personalized demo or request your own custom FedRAMP ROI calculation by contacting one of our FedRAMP specialists. I bet we won’t be far off.