Webtorials Time / Cost Savings Calculator

One of the most difficult parts of evaluating the economic impact of implementing technological changes, such as Unified Communications, SIP-based protocols, and mobility, is to quantify the actual monetary savings realized when time is saved.

To that end, we developed a technology-independent spreadsheet that can be applied to translate time savings into actual dollars. 

So, using a recent report on Mobile Unified Communications as an example, the process for applying this calculator to your own situation is as follows:

1. Determine the amount of time spent (wasted) per day on a specific list of tasks.

2. Determine the amount of that time which could be recovered by utilizing / changing / improving / altering technologies.  Chart below assumes the ability to save 30% of the time. 

3. Determine the number / percentage of employees to whom 1 and 2 apply. In the examples, these employees are referred to as "knowledge workers."  In this chart, one is able to enter your total workforce and the percentage of that workforce who are knowledge workers.  The "% of KWs in this range" will vary depending on the company makeup.

4. Determine their salary range(s), noting that the total must be 100%.

5. Determine how many hours they work per week.  In the example below we are using historical data from our research.
 
6. Multiply # of hours worked per week by the number of weeks the employee actually works. (calculated automatically in spreadsheet)
 
7. Determine how many annual Overhead Hours for which they're paid (personal / sick / vacation leave).  In this case, we assumed that 48 weeks per year are worked, with a total loss of four weeks.  Thus, 160 hours are added to the "paid" hours.
 
8. Multiply the salaries by 1.3 to incorporate / allow for the costs associated with the employee that are not paid directly to the employee (FICA matching, insurance benefits, etc.) = Gross Compensation (calculated automatically in spreadsheet)
 
9. Divide Gross Compensation by the sum of Hours Actually Worked and Overhead Hours to arrive at Hourly Rate (calculated automatically in spreadsheet).  The annual savings per employee are calculated by using the time saved per days times days/weeks actually worked.  (There are no savings on "overhead hours.")

10. These annual savings "per employee" figures can then be plugged back into the spreadsheet in Step 4 to arrive at the potential company-wide savings, again noting that the percentage of knowledge workers must be 100%.

You may download a copy of the calculator and massage the data with your own assumptions.