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High Financial ROI and Innovation from HPC Investments: IDC Research Update

This research update from IDC presents the economic models used to measure the financial Return on Investment (ROI) and innovation resulting from investments in High-Performance Computing (HPC). The study includes data on revenue, profits, and cost savings generated from HPC investments, as well as the innovation index and success stories from HPC implementations.

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High Financial ROI and Innovation from HPC Investments: IDC Research Update

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  1. IDC HPC ROI Research Update:Economic Models For Measuring The Financial ROI And Innovation From HPC Investments June 2016 Earl Joseph, ejoseph@idc.com Steve Conway, sconway@idc.com Robert Sorensen, bsorensen@idc.com Kevin Monroe, kmonroe@idc.com

  2. Grant References • The authors thank DOE for its insights and guidance on and funding of this grant-based research project • This study is based upon work funded by the U.S. Department of Energy Office of Science, Office of Advanced Scientific Computing Research, and the National Nuclear Security Administration, under award number DE-SC0012576. • DOE Program Managers: • Christine Chalk, 301-903-5152, christine.chalk@science.doe.gov, and Barbara J. Helland, 301-903-3127, barbara.helland@science.doe.gov, U.S. Department of Energy Office of Science, Germantown Building, 1000 Independence Avenue, S.W. Washington, D.C., 20585-1290, and Doug Wade in National Nuclear security Administration (NNSA). • Administrator/Contracting Officer: • Warren Riley, 630-252-2485, warren.riley@ch.doe.gov, U.S. Department of Energy Office of Acquisition and Assistance, 9800 South Cass Avenue, Argonne, Illinois, 60439 • IDC Reporting: • Principal investigator: Earl C. Joseph, Ph.D., 612-812-5798, ejoseph@idc.com • Senior technical project manager: John Daly, 508-935-4643, jdaly@idc.com

  3. Latest Findings: The ROI From HPC is Very High New results indicate high ROI returns resulting from investments in HPC • On average, from the latest data: • $673 in revenue per dollar of HPC invested • $44 of profits/cost savings per dollar of HPC invested • HPC investment per innovation = $3.9M • Note that an additional outcome of this research is an expansive list of HPC success stories

  4. Background: Three-Year Research Plan • 2013 pilot study: • Tested 3 approaches and set the models • Populated the models with 208 cases of scientific innovation and industrial ROI (this report shows results for 329 cases) • Created the innovation index • Three-year study: sponsored by DOE Science/NNSA • Refine the models to move from association towards causation • Try to collect thousands of cases: • Dense collection in the U.S. • Sparser collection elsewhere (but still large)

  5. Background: Project Overview A study that describes how HPC investments are related to improved economic success and increased scientific innovation The study includes large scale data collection to populate two unique models: • A macroeconomic model which depicts how HPC investments result in economic advancements in the form of ROI, growth and jobs • Two Innovation Indexes that measures and compares innovation levels, based on the level of applying HPC computing resources towards scientific and technical advancement

  6. The Financial ROI Models Used The Financial ROI models: • ROI based on revenues/GDP generated, divided by HPC investment • ROI based on profits generated, divided by HPC investment • ROI based on jobs created (and the HPC investment required per job created) The ROI models show variances by: • Industry sector • Country • Organization size

  7. Innovation Models Used Two innovations indexes are used: • Based on the importance of the innovation • How broadly the innovations impact different organizations The innovations are also sorted by the primary area: • Better Products • Major Scientific Breakthrough • Cost Saving • Created New Approach • Discovered Something New • Helped Society • Helped Research Program

  8. The Two Innovation Index Scales The IMPORTANCE this innovation compared to all other innovations in this field over the last ten years 5. One of the top 2 to 3 innovations in the last decade 4. One of the top 5 innovations in the last decade 3. One of the top 10 innovations in the last decade 2. One of the top 25 innovations in the last decade 1. One of the top 50 innovations in the last decade The IMPACT of this innovation to multiple organizations 5. An innovation that is useful to over 10 organizations 4. An innovation that is useful to 6 to 10 organizations 3. An innovation useful to 2 to 5 organizations 2. An innovation only useful to 1 organization 1. An innovation that is recognized ONLY by experts in the field

  9. The Innovation Models Used Plus the innovations are sorted by: • Basic Research / Major Innovations • Applied Research / Incremental Innovations The Innovation models can be sorted for variances by: • Industry sector • Country • Organization size • Government, Industry and Academia

  10. Sample Characteristics Sample demographics: • As of May 1st, 2016 we are at 329case study examples of ROI and innovations: • 114 financial ROI examples • 215 innovation examples

  11. Study Results: The Financial ROI From HPC

  12. New Findings: Financial ROI Results Results continue to indicate very substantial returns for investments in HPC: • $672.6 dollars on average in revenueper dollar of HPC invested • $44.1 dollars on average of profits(or cost savings) per dollar of HPC invested

  13. New Findings: Job Creation Results continue to indicate very substantial job creation from investments in HPC: • 2,756 jobs where created at 106 of these sites

  14. New Findings: Financial ROI Model – By SectorFor 114 Sites That Created a Financial ROI

  15. New Findings: By Industry

  16. Study Results: Innovation

  17. New Findings: Mix Of Innovation Types (For ALL 329 PROJECTS)

  18. New Findings: Mix Of Innovation Types (For 114 FINANCIAL ROI PROJECTS)

  19. New Findings: Mix Of Innovation Types (For 215 INNOVATION PROJECTS)

  20. New Findings: 215 Innovations – Basic vs. Applied

  21. New Findings: 215 Innovations – By Industry/Sector

  22. New Findings: The Innovation IMPORTANCE Index 5. One of the top 2 to 3 innovations in the last decade 4. One of the top 5 innovations in the last decade 3. One of the top 10 innovations in the last decade 2. One of the top 25 innovations in the last decade 1. One of the top 50 innovations in the last decade

  23. New Findings: The Innovation IMPACT Index 5. An innovation that is useful to over 10 organizations 4. An innovation that is useful to 6 to 10 organizations 3. An innovation useful to 2 to 5 organizations 2. An innovation only useful to 1 organization 1. An innovation that is recognized ONLY by experts in the field

  24. Download Results:www.hpcuserforum.com/ROI

  25. Questions? Please email: hpc@idc.com Or check out: www.hpcuserforum.com

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