---
title: "Enterprise software ROI leaks in 3 places: 56% value gap, 46% idle seats"
summary: "Where enterprise software returns are lost, measured: McKinsey and Oxford's 5,400 projects, Zylo's 2026 idle-seat data and Microsoft's 1 July 2026 price rise, as of September 2026."
url: https://www.thetechbag.com/blog/maximizing-roi-enterprise-software-best-practices-strategies
format: Analysis
desk: "Buying software in India"
published: 2025-06-10
facts_checked: 2026-09-30
author: TechBag (The TechBag Journal)
tags: ["ROI","enterprise software","SaaS licences","renewals","Microsoft 365","pricing","Zylo","Vertice","GST","DPDP"]
cover: https://www.thetechbag.com/blog/covers/maximizing-roi-enterprise-software-best-practices-strategies.png
---

# Enterprise software ROI leaks in 3 places: 56% value gap, 46% idle seats

*Where enterprise software returns are lost, measured: McKinsey and Oxford's 5,400 projects, Zylo's 2026 idle-seat data and Microsoft's 1 July 2026 price rise, as of September 2026.*

Analysis · Buying software in India · By TechBag · Published 2025-06-10 · Facts checked 2026-09-30 · Canonical: https://www.thetechbag.com/blog/maximizing-roi-enterprise-software-best-practices-strategies

The short version

- The return on enterprise software leaks in three places that can be measured: at **build**, where large IT projects delivered 56% less value than predicted; in **use**, where the average organisation uses 54% of its SaaS licences; and at **renew**, where SaaS prices rose 12.7% to 16.4% a year between June and August 2026.[1] [2] [3]
- A 500-seat Microsoft 365 E3 estate costs about ₹1.94 crore a year at US list after the 1 July 2026 rise, before GST. At the utilisation Zylo reports, ₹89 lakh of that buys seats nobody opens.[4]
- The cheapest lever is the seat count at renewal, not another feature. Write down the value the software must deliver before you sign, count logins before you renew, and read the notice period before either.

The 2023 version of this post gave six best practices (define goals, drive adoption, customise, integrate, maintain, measure) and opened with five statistics attributed to Gartner, Forrester, TechRepublic, Panorama and McKinsey. We could not find a dated report behind any of the five, so they are gone. The question underneath was a good one, though, and an Indian CIO or CFO still asks it every budget cycle: once the contract is signed, where does the money go missing, and which of those leaks can a buyer close with a purchase order rather than a transformation programme? We call the answer the **build, use, renew** test, and each leak has a number.

## Build: large projects deliver 56% less value than planned

The most cited measurement of IT project outcomes is still McKinsey’s work with the BT Centre for Major Programme Management at the University of Oxford, which examined more than 5,400 IT projects. On average, large IT projects, defined as those with an initial price tag above US$15 million, ran 45% over budget and 7% over time while delivering 56% less value than predicted. Seventeen per cent went so badly that they could threaten the existence of the company.[1]

**Figure: The overrun gets the attention, but the bigger miss is value: 44 of every 100 units promised arrived**

*Average value delivered by large IT projects (initial budget above US$15 million), per 100 predicted, study published 2012*

44%

Value delivered, per 100 predicted

while cost ran 45% over budget and time 7% over schedule

Source: McKinsey and the BT Centre for Major Programme Management, University of Oxford; more than 5,400 IT projects · as of 30 September 2026 · Large projects only; a mid-sized SaaS rollout is not this population. 44 is 100 minus the study's 56% shortfall

ReportedWhat the study does and does not cover

It is a study of large projects, published in 2012, and most of the software an Indian mid-market company buys today is a subscription, not a build. The transferable finding is the ratio: projects missed on value by more than they missed on cost, because value was rarely written down in a form anyone could check later.[1]

That is the original’s first practice, “identify and define business goals”, made testable. Before the purchase order, write down three numbers the software must move (days to close the books, tickets per agent, hours to onboard a joiner), the current value of each, and the date you will measure again. A goal without a baseline cannot be missed, which is why it so often is.

## Use: 46 of every 100 licences sit idle

Zylo’s 2026 SaaS Management Index, drawn from the portfolios Zylo manages for its customers, finds that the average organisation uses 54% of its SaaS licences and wastes US$19.8 million a year on unused licences alone. The waste scales with size: US$3.8 million at companies of up to 500 staff, US$9.5 million at 501 to 2,500, US$29.8 million at 2,501 to 10,000 and US$80.6 million above 10,000.[2]

**Figure: Even a company of under 500 staff carries US$3.8 million a year of unused licences**

*Average annual spend on unused SaaS licences by company size, US$ million, Zylo 2026 index*

Up to 500 staff

3.8 US$ million

501 to 2,500 staff

9.5 US$ million

2,501 to 10,000 staff

29.8 US$ million

More than 10,000 staff

80.6 US$ million

|  | Value (US$ million) |
| --- | --- |
| Up to 500 staff | 3.8 |
| 501 to 2,500 staff | 9.5 |
| 2,501 to 10,000 staff | 29.8 |
| More than 10,000 staff | 80.6 |

Source: Zylo, How much is wasted on SaaS spend, citing the 2026 SaaS Management Index · as of 30 September 2026 · Zylo customers' portfolios, not a census; Zylo sells SaaS management software

The firm that measures the disease sells the cure, so read the figure as reported, not counted. But the direction matches what every admin console shows when someone finally looks: seats assigned to leavers, licences bought for a project that ended, premium tiers given to people who use the basic features. The original’s “ensure user adoption” is half of the fix. The other half is removing the seat when adoption does not happen.

Our view

Our view: count before you train. Pull last-login data for every application with more than 20 seats, ninety days before each renewal. A seat with no login in that window is removed at the renewal, not argued about after it. Training spend goes to the applications where the logins are there but the outcomes are not.

## Renew: prices rose whether or not the seats were used

Vertice’s SaaS inflation tracker, built on the spend it processes for customers, recorded a record 16.4% rise in SaaS prices in June 2026, easing to 12.9% in July and 12.7% in August.[3] The best documented single case is Microsoft’s. On 16 February 2026 it announced list-price changes effective 1 July 2026: Microsoft 365 E3 with Teams from US$36 to US$39 a user a month, E5 from US$57 to US$60, Office 365 E3 from US$23 to US$26, Business Basic from US$6 to US$7 and Business Standard from US$12.50 to US$14. Business Premium stayed at US$22, and the frontline F1 and F3 seats rose the most.[4]

**Figure: Microsoft's 1 July 2026 rise was steepest on the cheapest seats and zero on Business Premium**

*US list price per user per month, with Teams, before and after 1 July 2026, US$; change in %*

|  | Before 1 July 2026 | From 1 July 2026 | Change |
| --- | --- | --- | --- |
| Microsoft 365 F1 | 2.25 | 3 | 33% |
| Microsoft 365 F3 | 8 | 10 | 25% |
| Business Basic | 6 | 7 | 17% |
| Office 365 E3 | 23 | 26 | 13% |
| Business Standard | 12.5 | 14 | 12% |
| Microsoft 365 E3 | 36 | 39 | 8% |
| Microsoft 365 E5 | 57 | 60 | 5% |
| Business Premium | 22 | 22 | 0% |

Source: Microsoft, 2026 Microsoft 365 packaging and pricing updates (16 February 2026); TechBag arithmetic · as of 30 September 2026 · US list prices; country price lists, including India's, may differ

The pattern is a business model, not an accident. A flat Business Premium beside a 16.7% rise on Business Basic and 12% on Business Standard makes the security bundle look cheap at the moment of renewal. That may be the right move for you; it should be a decision, not a default. The original’s practices stopped at go-live. Renewal is where the third leak sits, and it has a date you already know.

## One 500-seat estate, worked in rupees

Put the three leaks on one bill. Take 500 users on Microsoft 365 E3 with Teams for a year, at US list and the ₹83 to the dollar TechBag’s buying guides use.

TechBag countTechBag arithmetic

Before 1 July 2026: 500 × US$36 × 12 = US$2,16,000, about ₹1,79,28,000. After: 500 × US$39 × 12 = US$2,34,000, about ₹1,94,22,000, so the rise alone is ₹14,94,000 a year. GST at 18% adds ₹34,95,960. If utilisation matches Zylo’s 54%, 230 seats are idle: 230 × US$39 × 12 = US$1,07,640, about ₹89,34,120 before GST.[2] [4]

**Figure: At Zylo's utilisation, idle seats cost six times what the July price rise added**

*500 Microsoft 365 E3 seats for a year at US list after 1 July 2026, ₹ lakh at ₹83 to the dollar*

Licence bill after 1 July, before GST

194.2 ₹ lakh

Spent on idle seats (46%)

89.3 ₹ lakh

GST at 18% on the full bill

35 ₹ lakh

Added by the 1 July rise

14.9 ₹ lakh

|  | Value (₹ lakh) |
| --- | --- |
| Licence bill after 1 July, before GST | 194.2 |
| Spent on idle seats (46%) | 89.3 |
| GST at 18% on the full bill | 35 |
| Added by the 1 July rise | 14.9 |

Source: Microsoft price list (16 February 2026); Zylo 2026 index utilisation; TechBag arithmetic · as of 30 September 2026 · Illustrative: assumes Zylo's average utilisation applies; Indian price lists and negotiated discounts differ

The order of the bars is the order of the work. Negotiating a few points off the rise is worth less than finding the idle seats, and both are worth less than the value question in section one if the software is not moving the number it was bought for. The original’s “customise” advice deserves a caution here too: every customisation is a cost at each upgrade and an argument against switching at renewal, so customise only where the baseline number demands it.

The original’s last practice, “measure performance”, becomes a calendar. For every contract above a few lakh a year:

1. **At signature,** record the renewal date, the notice period and the price-increase clause in one register, next to the three baseline numbers from section one. A renewal that auto-extends because nobody saw the notice date is the most expensive line in the register.
2. **Ninety days before renewal,** pull last-login data and the tier each user actually needs. Remove idle seats, move light users to a lighter SKU where the licence terms allow it, and ask the vendor for the new price in writing.
3. **Sixty days before,** re-measure the three numbers. If the software has not moved them, the conversation is about whether to renew at all, not about the discount.
4. **At renewal,** sign for the seats you counted, not the seats you had, and put the data-handling terms in the same order form.

None of this needs a new tool for an estate of a handful of large contracts. A SaaS management platform starts to pay when the application count runs into the hundreds and nobody can say who bought what; below that, an owner per contract and a shared register do the job.

If you are buying this in India

**Price and tax.** Microsoft and most large vendors sell in India through a rupee price list and partners, so the US list above is a scale, not a quote. Software billed from abroad to an Indian business is an online information and database access or retrieval (OIDAR) service: 18% IGST is payable by you under reverse charge.[5] A GST-registered business can usually claim the input tax credit under section 16 of the CGST Act, which makes GST a cash-flow cost rather than a final one; idle seats carry their GST with them either way.[6]

**The renewal is also the compliance moment.** The DPDP Rules were notified on 13 November 2025 and their substantive duties, including security safeguards and breach intimation, apply from 13 May 2027.[7] A three-year SaaS renewal signed now runs past that date, so the renewal is when to add processor terms: where data sits, deletion at exit, breach notice. CERT-In’s Directions of 28 April 2022 require logs to be kept for 180 days within India, which decides the logging tier you need.[8] Banks have a third check: RBI’s Directions of 31 July 2026 require vendor contracts that carry audit and RBI inspection rights.[9] TechBag quotes renewals in INR with GST shown and the notice period on the order form.

How we did this

Figures as of 30 September 2026

Project outcomes are McKinsey and Oxford’s published averages for large IT projects (2012). Utilisation and waste are Zylo’s 2026 index as quoted on its own page, updated 19 March 2026; the base is Zylo’s customer portfolios. SaaS inflation is Vertice’s tracker for June to August 2026; later months were not used. Microsoft prices are US list from Microsoft’s 16 February 2026 notice, with Teams; percentage changes and the 500-seat example are TechBag arithmetic at ₹83 to the dollar, the rate in TechBag’s browse guides, with 18% GST. The example assumes Zylo’s average utilisation and no discount; it is a scale, not a quote. The five statistics in the 2023 original were removed because no dated source could be found for them. No vendor was contacted.

Spotted an error? Write to us; corrections are published at the foot of the piece.

Sources

1. [McKinsey, Delivering large-scale IT projects on time, on budget, and on value (with the BT Centre for Major Programme Management, University of Oxford)](https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/delivering-large-scale-it-projects-on-time-on-budget-and-on-value) — October 2012
2. [Zylo, How much is wasted on SaaS spend (54% of licences used; US$19.8 million average waste; waste by company size; 2026 SaaS Management Index)](https://zylo.com/blog/how-much-wasted-on-saas-spend) — updated 19 March 2026 Zylo sells a SaaS management platform.
3. [Vertice, SaaS inflation rate tracker (16.4% June, 12.9% July, 12.7% August 2026)](https://www.vertice.one/insights/saas-inflation-rate) — data to August 2026 Vertice sells SaaS procurement services.
4. [Microsoft, 2026 Microsoft 365 packaging and pricing updates (effective 1 July 2026)](https://www.microsoft.com/en-us/licensing/news/2026-M365-Packaging-Pricing-Updates) — 16 February 2026
5. [India Briefing, OIDAR services: GST and reverse charge](https://india-briefing.com/news/tax-digital-services-oidar-in-india-gst-applicability-and-compliance-22465.html) — 29 September 2023
6. [CBIC, CGST Act 2017, section 16 (input tax credit)](https://cbic-gst.gov.in/CGST-bill-e.html) — 12 April 2017
7. [Legismith Partners, DPDP Rules 2025 commencement timeline](https://legismith.com/dpdp-rules-2025-timeline/) — Rules notified 13 November 2025
8. [CERT-In, Directions under section 70B(6) of the IT Act, 2000 (180-day logs within India)](https://www.cert-in.org.in/PDF/CERT-In_Directions_70B_28.04.2022.pdf) — 28 April 2022
9. [RBI, Cybersecurity, Technology Risk and Resilience Framework Directions, 2026, via practitioner summary](https://taxguru.in/rbi/rbi-issues-commercial-banks-cybersecurity-technology-risk-resilience-framework-directions-2026.html) — 31 July 2026 RBI PDF not fetched.

Related on TechBag: the [Microsoft 365 page](https://www.thetechbag.com/microsoft/microsoft-365) sets out the Business and Enterprise plans; the [Matrix42 SaaS Management page](https://www.thetechbag.com/matrix42/matrix42-saas-management) covers the tools that count idle seats; the [ITSM and service desk guide](https://www.thetechbag.com/browse/endpoint-management/itsm-service-desk) shows which platforms keep the asset register in the same tool.

**Disclosure.** TechBag is a software reseller: it earns a margin when a reader buys through it, including from vendors named here. The analysis is TechBag’s own; no vendor paid for or saw this piece before publication. Facts are labelled reported, TechBag count or our view.

Go deeper on TechBag

- [ITSM & service desk guide](https://www.thetechbag.com/browse/endpoint-management/itsm-service-desk) — which platforms keep the asset and licence register in the same tool
- [Microsoft 365: Business and Enterprise plans](https://www.thetechbag.com/microsoft/microsoft-365) — the suite behind the 500-seat worked example
- [Matrix42 SaaS Management](https://www.thetechbag.com/matrix42/matrix42-saas-management) — a tool that counts idle seats before renewal