Sunday, 21 June 2015

Improving Documentation ROI: Part 3 - Financial Costs

In Part 1 we looked at what ROI is, and how to calculate it.
In Part 2 we looked at the broad picture of cost areas, specifically money and time.

In Part 3, we're going to look in more detail at reducing financial costs.

You may remember that at the end of
Part 2 we talked about the broad areas in which you could reduce costs, and split them into direct and indirect costs:

1 - Reducing department costs (e.g. cost of tools)
2 - Reducing company costs (e.g. lowering the number of support calls)
3 - Improving department efficiency (e.g. single sourcing, homogeneous documentation suites)
4 - Improving company efficiency (e.g. centralised documentation management using taxonomies)

Direct costs (1 and 2) are those that relate to a specific product or team, whereas indirect costs (3 and 4) are spread over a number of products or teams.  A cost may be direct in one situation or indirect in another.  For example, if you have one product and you need to generate a help file for it, you can purchase a tool that will help you do that.  That would be a direct cost.  But if you have several products and you'll use the tool to generate help files for all of them, that would be an indirect cost. 

You don't need to get too hung up on the difference between direct and indirect costs, but you should keep them in mind because they have the following important differences:

  • Direct costs are typically easier to measure, but (sometimes) have less of an impact on ROI because their scope is smaller.
  • Indirect costs are typically more difficult to measure, but (sometimes) have more of an impact on ROI because their scope is larger.
You should be aware of this when looking at ways to improve your ROI because you may find that it's a lot easier to get backing for investment to lower direct costs than it is to get backing for investment to lower indirect costs.  It's easy to struggle to find unambiguous measurements for indirect costs, and therefore a proposal for investment to lower them can be a tricky sell.  However, if you're looking for projects where you can potentially make the biggest savings or introduce the biggest efficiency gains, those with indirect costs have the best potential for this because they affect a wider subset of products and teams.  Pick the battles you can win though, not the battles that have the biggest prize.  Work up to bigger prizes once you've won some smaller battles and proven yourself - you'll get a much more favourable reception if you already have a track record of reducing costs and increasing efficiency.

With both direct and indirect costs you can save 2 things: Time and money.  As discussed in
Part 1, every activity has an opportunity cost, which is the same thing as saying time equals money. So in this post we'll look at ways to reduce financial costs and/or improve the ROI of financial costs, and in the next post we'll look at time costs.

The financial costs for documentation  - the things your company actually has to pay cold hard cash for - are normally pretty limited, whether they are direct or indirect. There are generic cost saving measures that a company can employ, such as using video conferencing to save on travel costs, having enforced expense limits, and so on, but these don't particularly apply to documentation anymore than they do for other areas of your business. So we won't look at those except to say that if your company is a bit profligate and you think the Documentation team can take a lead in reducing costs without sacrificing the quality of your output, go right ahead.  Anything which improves your reputation and value to the company is a good thing.

The specific expenses for documentation, over and above the generic fixed costs like office space and computers, are normally Technical Writers and tools.  As stated in
Part 1 I'm not interested in helping companies reduce headcount, so that leaves tools as the one financial cost.  Depending on what documentation you need to produce, you might have some or all of the following types of tools:
There are other types of tool, but these are probably the most common ones.  I haven't included tools that are normally available "out of the box" like HTML viewers, browsers, and so on, and ignored tools that are normally common to a company (as opposed to just the documentation team) such as version control, collaboration tools and PDF viewers.

The cost of these tools comes down to licensing.  To reduce this cost, firstly you can make sure that you have all of, and only, the licences you need (you'd be surprised how many people just assume that they need the same number of licences with the same level of support, every time the renewal comes up), and secondly you can look into free or cheaper alternatives.  Now I'm not saying that you have to take the cheapest option and ignore functional requirements. You'll prise my copy of MadCap Flare out of my cold, dead hands, but Photoshop? Do you really need that?  The answer might be "Yes", but there are excellent free alternatives like Paint.NET and The Gimp that provide large swathes of the functionality that PhotoShop does without the burden of the cost.  Similarly, do you really need SnagIt when you can click PrtScn to capture whatever is on your screen (or ALT+PrtScn to capture just the application that has focus) and crop it in Paint.NET?  Again, the answer might be "Yes", but it might be "No".  And if there's one person on your team who legitimately can't do their job without Photoshop, but everyone else can, then you can still reduce your licence number down to 1, which will be a significant saving given the cost of some of these tools.

Reducing your licence costs can be seen as not so much an improvement on the return on investment, so much as a reduction of the investment itself.  But if as Technical Writers you are doing the same (or more) with less, that can also be seen as an improvement on the ROI.  Either way, reducing the financial costs of documentation whilst maintaining productivity and quality is always something worth aiming for. Let's look at an example of this in budget terms (all items costs are examples):

Cost of 1 help authoring licence: £750 per year.
Cost of 1 image editing licence: £750 per year.
Cost of 1 screen recording licence: £400 per year.
Cost of 1 screen shot capturing licence: £100 per year.

You have 4 Technical Writers, all of whom have 1 licence for each of these 4 things.

Total licence cost: (750 + 750 + 400 + 100) x 4 = £8000 per year

Following a review of who uses what, you decide the following:

  • 4 writers need the help authoring tool. 
  • 1 writer needs the paid-for image editing tool for occasional-but-critical advanced image editing. The other 3 writers only do basic image editing which can be achieved with free tools without any loss of quality or speed.
  • 3 writers need a screen recording tool for their documentation deliverables. 1 writer works on a product for which screen recordings are not required.
  • No writers need a screen shot capturing tool.
This changes the licence costs to:

4 x help authoring tools @£750
1 x image editing tool @£750
3 x screen recording tools @£400

Total cost: (4 x 750) + (1 x 750) + (3 x 400) = £4950

This is a reduction of £3050, or a 38.125% reduction in financial costs.  And it gets better: This cost reduction will apply every year until or unless circumstances change, so over the course of 3 years your company will spend £9150 less, simply by you performing a one-time review of your licences.

Admittedly, it is often the case that the savings won't be this dramatic, but this example is used because it is an entirely plausible scenario.  In technical divisions there can often be a certain amount of "keeping up with the Joneses", which can lead to a culture where if one person is given a licence for a tool it can be seen as an indication that they are more senior or more important or working on something cooler.  Sometimes this is true, but a lot of the time it's not - a person is given what they need to do the job.  But the whole team will be given the tool to prevent grumbling.  After a pretty short period of time, most people realise that they don't actually need the tool, so the money spent has essentially been wasted.

(There is an argument that an investment in something that keeps team morale up and unhappiness down is a valid investment, and I have sympathy with that.  No-one wants to work at a company that won't provide free coffee because they're too tight to spend £20 a month on a tin of Nescafe.  However, there is a difference between providing benefits that make the workplace a pleasant place to be, and wasting money to appease a few grumblers.  Paying hundreds or thousands of pounds a year for licences to make sure everyone has access to the new toys, even if they never need them, is not a benefit, it's a waste of money.) 

So, regardless of why people have got a licence for something, periodic reviews of your licensing will help you keep costs to the (sensible) minimum.

On top of the licences themselves, there is often a maintenance package attached.  In some cases the maintenance package is an additional cost to the licence, but never provides anything you use.  As an example, in many cases the maintenance fee solely provides access to 24 hour telephone support, which sounds great, but have you ever actually used it?  How many problems have you had with your image editing tool that you haven't been able to solve through a combination of help files, forums, and Google?  Probably not many.  So if you're paying for support, have a think about whether you really need it, or if only one of you can have it as a backstop in case you need to phone support.

The flip side of this is that the support is often bundled with free upgrades, and that's something you'll want to keep.  Also, from my own experience, a member of my team once had a sudden and complete motherboard failure on his computer.  MadCap Flare, which we used day in, day out, is linked to the specific machine as part of the licensing, and although you can deactivate the licence on one machine and reactivate it on another, if the motherboard fails that isn't an option.  I used the support we got as part of the maintenance package to phone MadCap, explain the situation and get the licence deactivated, and when my colleague's computer was up and running again an hour later after the motherboard had been changed, he just reinstalled Flare, entered his licence code, and he was good to go.  That alone was worth paying the maintenance for (and fair play to MadCap, they answered the phone right away and sorted it out within minutes).  So choose your path carefully, and don't go the cheap route unless you are legitimately confident that cutting maintenance will have no impact.

All of the above is mainly about reducing the investment.  What about increasing the investment to get a better return?

This is going to be a very contextual decision, and one that needs to be made in terms of increasing your ROI.  I can evangelise about the benefits of using a good help authoring tool instead of a word processing package all day, but the important question is: Can your investment provide a return that is greater than the cost? 

Obviously your investment in a software application is unlikely to return a direct financial benefit, so you need to understand what benefit it will bring.  Let's look at an example.

Your help desk gets 200 tickets a week, of which 10 tickets (5%) are questions about how to perform a particularly complex function in your application.  It takes the help desk on average 15 minutes to talk the person through the function. 15 minutes x 10 tickets = 150 minutes (2.5 hours).  It will cost you £400 to buy the screen recording tool that you can use to make a video that will provide this walk through, and 4 hours to make the recording and embed it in the help file, thus freeing up the help desk to deal with other tickets. 

What is the ROI on this investment?

Assume a week to be 40 hours.
Assume the cost per week of a help desk consultant or a technical writer to be £600.

Cost of dealing with these tickets = 2.5 hours = 6.25% of a week = £37.5 per week
                                                                                                 £150 per month
                                                                                                 £1800 per year

Cost of the screen recording = £400 software cost + (4 hours = 10% of a week = £60) = £460

ROI over one year = (£1800 - £460)/£460 = 2.91 = 291%

So even where the initial investment is quite high relative to the short term cost of just dealing with the tickets, over a period of time the investment pays off well.  On the minus side, the screen recording may not be suitable for all of the tickets that come in.  But as long as 3 out of the 10 tickets are removed from the help desk workload each week, the ROI over a year will still be positive (I'll leave you to run those figures).  On the plus side, you may be able to do this for other complex functions and save the help desk consultants even more time without having to spend any more money as you have already paid for the tool.

This is just one example of ways that an appropriate financial investment can help the documentation team improve their ROI. 

Next up in this series: Reducing time costs.

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