Before anything is connected
- Count the items going through one process for a month
- Time the same steps on a sample, by hand
- Record how long decisions wait, and for whom
- Count the items that came back for rework, and why
Value and ROI
A formula you can argue with, not a percentage to believe.
We have no measured customer results, so we are not going to show any. What we can show is the arithmetic, the inputs it needs from you, and how a pilot would produce them.
Value and ROI
Three things worth measuring before anyone claims a return.
Freed hours are capacity first. They become money when a real cost falls or more paid work gets through. Use the formula with your own numbers — volume, times, and costs.
minutes per item
Time spent processing an item
How long it takes today to get one requested item from arrival to a priced, checked line.
You measure this, before and after
hours per decision
Time waiting for approval
How long a decision sits between the moment it is needed and the moment someone makes it.
You measure this, before and after
share of items reworked
Work repeated because of errors
How often a wrong part number, price, or quantity sends the same item back through the process.
You measure this, before and after
- NItems processed per month500You provide
- ΔtMinutes saved per item12You provide
- AShare of items where the tool is used70%You provide
- CFully loaded cost per hour18.00You provide
- FMonthly product and support cost850Agreed in the pilot
- IOne-time implementation2,400Agreed in the pilot
- THorizon in months12You provide
Seven inputs, all of them yours or agreed with you. When the calculator is built, these fields become editable and the numbers on the right recalculate.
- 70Hours freed per monthN × Δt × A ÷ 60
- $1,260Time value per monthHours × C
- $1,050Full monthly costF + I ÷ T
- $210Net per monthBenefit − F − I ÷ T
- 20%Return over 12 months[T(Benefit − F) − I] ÷ [T·F + I]
- 5.9 monthsPayback of the one-offI ÷ (Benefit − F)
Worked from the numbers on the left with confirmed error savings set to zero. Bring your own volume, times, and costs to a pilot discussion to see the return for your team.
The maths
Every symbol, spelled out.
If a vendor will not show you this, the number they quote is decoration.
- N
- Items processed per month
- Δt
- Minutes actually saved per item
- A
- Share of items where the tool is really used
- C
- Fully loaded cost of an hour
- E
- Confirmed savings from avoided errors
- F
- Monthly product and support cost
- I
- One-time implementation cost
- T
- Horizon in months
Hours = N × Δt × A ÷ 60
Time value = Hours × C
Monthly benefit = Time value + E
Net of roll-out = Benefit − F − I ÷ T
Return over T = [T × (Benefit − F) − I] ÷ [T × F + I]
Payback of I = I ÷ (Benefit − F) only when Benefit > FTwo things people add up that should not be added up
Freed hours are capacity, not cash. They become money only if a real cost falls or more paid work gets through. And faster revenue is a separate effect with separate evidence — adding it to time savings double-counts the same benefit.
Measurement
What a pilot would actually measure.
The same process, the same steps, before and after. Otherwise the comparison is a story.
After, on the same process
- The same count, the same steps, the same sample
- How often the tool was actually used, not licensed
- Waiting time per decision type
- Rework, and whether the cause changed