Will Your Upgrade Measure Up?

When youbre contemplating making a substantial purchase decision, how do you know whether it will cost-justify itself?B Well, I put together just this sort of analysis recently for one of our customers considering a new phone system purchase.

Herebs a few suggestions for any thorough evaluationb&

  1. Make sure you are clear about the costs you are currently incurring.B Some of these costs may be bburiedb and require a bit of detective work to uncover.
  2. Ask plenty of questions to develop the ball-inb costs associated with the purchase.B Watch for bhidden costsb that will be incurred for maintenance, improved features/functionality, etc.
  3. Create an hourly cost for each staff member.B This can be actual cost or lost opportunity cost.B For example, an employee making $60K/annual might cost $35/hour but bill $100/hour.
  4. Evaluate the estimated time savings per employee for each feature/functionality improvement.B The savings can add up really quickly even if the time savings is only a few minutes per day.

To give you an idea about how this calculation looks using our example from above:

Feature Time Savings=5 minutes/dayB B B B $2.92 ($35/12) X 225 (work days/year) =$657.00

So, just using the lower cost rate of $35/hour results in an annual savings of $657b&only saving 5 minutes per day!B It can be very helpful to go through this exercise when youbre considering implementing any technology improvement.

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