Process: Process Example

© 2012, StraightForward Tools. All rights reserved. For use by licensed user only.
© 2012, StraightForward Methods. All rights reserved.

Cost of Ownership Enter Assumptions in Yellow Cells Projected Savings

Enter Software Costs (Initial) (If cloud enter zero) $100,000.00 YR 1 Savings

1st Year Annual Maintenance is calculated if cell 4 is entered. If not, (if

cloud enter annual subscription) $21,000.00 21% $135,000.00

% above is recurring
annual maintenance of
Enter Vendor Training and Services Costs $30,000.00 license costs 3 YR Savings
Enter Hardware/Infrastructure (if cloud zero) $10,000.00 $675,000.00

Enter *Human Resources Costs (see assumptions tab) $ 132,000.00 3 yr costs

Total Solution Costs Year 1 $293,000.000 $477,590.00 (ROI Before Depreciation, etc.)
** Ongoing Costs Annual (see assumptions tab) $61,530.00 Solution Costs Less YR 1 Savings

"Processing Handling" Costs and Estimated Savings -$158,000.00

Process Name: Process XYZ Solution Costs Less YR 3 Savings
Current Transaction Volumes $197,410.00

Enter Transactions (items) Processed Annually 9,000 Projected 3 YR ROI

Calculated Transactions Processed Daily 32.1428571428571 41%
Projected Cost Savings Your Assumptions
Enter Current Costs per item (or use calcuated cost below) $ 75.00 Projected Process Handling Cost Savings
Enter Projected Cost Reduction (%) (see Assumption sheet for some
industry metrics) 40% $ 270,000.00 12 Months in Production
Calculated Projected Cost Savings Per Item $ 30.00 $ 135,000.00 6 Months in Production in Yr 1
OR - CALCUATE COST PER ITEM $ - *** Enter additional cost reductions (see assumptions)
Cost Per Item Calculated
Enter Current Required FTEs 3 Number of Full Time Employees that handle this work

Proprietary and Confidential 7 10/29/2020

Enter Loaded Cost Per FTE (per day) 800 What is the cost per day for that employee - loaded with benefits/etc
Enter Additional Costs (per Day)
Calcuated Cost Per Item $ 74.67 This then is a cost per item

Proprietary and Confidential 7 10/29/2020

 Assumes start of ROI is from
application in production 6 mos
after purchase.

$270,000.00

3 Yr savings is based on 6 mos of

development/ 6 mos in
production in yr 1 and 12 mos yrs
2 and 3

Net profit ($) / Investment ($) *

100 %

ctions (see assumptions)

Proprietary and Confidential 7 10/29/2020

Qualitative Benefits - Examples

Improved Existing Customer Service/Customer Retention

Improve turn around time providing faster service
Reduce/eliminate status inquiry calls through inquiry self service
Improve quality of service by eliminating frustrations associated with rework and errors

Increase Revenues/Customer Acquisition

Bring new products or services to market faster
Deliver samples, quotes, contracts, estimates etc. to prospects faster and more acurrately

Improve Employee Service/Employee Retention

Improve turn around time providing faster service
Reduce/eliminate status inquiry calls through inquiry Self Service
Eliminate frustrations associated with duplicate efforts, rework and errors

Get Employees Productive Faster

Simplify work activities - reduce need for in-depth policy knowledge and simplify system navigation
Shorter training time
Speed employee on-board time

Risk Reductions/Compliance Adherence

Reduce risk of penalties or fines asscoiated with regulatory compliance
Enforce policies, required approvals, contracts
Automatic audit all activities

Workforce Optimization
Avoid the need to hire more people to process increasing volumes
Reallocate staff to more value-add activities
Minimize administrative activities to keep employees focused on value add work and activities
Gain visibility into workforce metrics
Industry Data
Average Improvements Aberdeen Report - 2010
43% decrease in cycle times
44% improvement in application development/modification time
18% y/y operating cost reductions
17% increase in output

Forrester Research
58% 3 yr ROI August 2011 Report
30-50% productivity gains for processes involving primarily back office, clerical staff, producti

Type of Process Costs Per Item To Process Source

Purchase Request $ 96.00 Ernst & Young
$ 150.00 Gunn Partners
$ 190.00 Deloitte & Touche (18 largest companies)

Invoice Handling $ 13.59 Paystream 2010 Survey

$ 10.00 Cass Benchmark

Expense Claim $ 14.63 Paystream Survey - 2010 survey

General Manual Handling

Costs $5.00 Approval Processes/Steps
$10.00 Admin/Processing Steps

ROI Assmumptions
*Human Resource Costs Annual Utilization
Developer $ 110,000.00 50%
PM $ 100,000.00 25%
BA $ 90,000.00 50%
Adminstrator $ 75,000.00 10%

** Ongoing Costs
Annual maintenance for software, plus 20% of initial costs for ongoing change, support, application maintenance
***

***Enter any additional cost reductions s

elimination of business systems (license/hardware)
elimination of mistakes/associated penalties - over payments/duplicate payme
reduction of training costs
other costs
Total Other Cost Savings
ce, clerical staff, productivity gains for processes involving knowledge workers.

Total
$ 55,000.00
$ 25,000.00
$ 45,000.00
$ 7,500.00
$ 132,500.00

tion maintenance

$ -
$ -
$ -
$ -
$ -