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question to all you network admins out there....
hulkster:
this is basically a corporate business question, and mainly for those who have staff under them in an IT department.
emails are sent out all the time from different departments where i work about how much money they made/saved because they are able to do that. for instance, an email is sent out to everyone...."Bob's department made the company an extra $5 million because they hired 2 extra people and were able to meet such and such goals. hurray for Bob's department, keep up the good work!".
im the network admin here where i work, and i would love to be able to send out emails like this congratulating my dept. on making the company more money, or showing we upped productivity 12% by updating this software.
for instance, i was talking with our CEO on the golf course the other day, and i was telling him about some new software we are getting for network management and how it will be so great. and the first thing he asked me was "wow, how much will that save us over the next 2 years??" and i had no idea how to answer that. i would love to be able to say "it will save us X amount of dollars in the long run" and thats not so much the hard part, but the hard part is....how do i calculate the productivity increase for the company after updating or installing new software?
this is a bad example, but lets just say that we've never used MS Office before and everyone has been typing in Notepad for the last 5 years. (i know its far fetched but stay with me) so i introduce MS Office and now all of a sudden everyone can save spreadsheets, and type docs with bullets and do powerpoint presentations, etc. etc. you get the idea. how do i calculate how that will increase productivity? it obviously will increase morale, and increase the speed in which people will do things and the ease of things (dont bash on MS right now...i know they arent perfect)....but how do i turn all that obvious stuff into a concrete percentage increase or figure or a graph to show the CEO? anybody have experience with this kind of thing?
ChadTower:
What you're asking is pretty much "what do I learn from an MBA program", if that helps any. They're not simple questions to answer.
shardian:
Just make up a number like all the other guys posting congratulatory notes are doing. ;D
Chris G:
I'm not a network admin, but I used to do financial analysis for IT projects like this at our company. You will likely need help from someone in your Finance department to do this with any credibility.
Most of these projects do not MAKE money, they SAVE money, as you said. So you need to look at which costs could be impacted... labor, contractor costs, licensing, etc. and come up with some relevant metrics which can be translated into periodic cost savings. Of course, you also need to take into account the costs to implement (capital) and maintain (expense) the new solution, which offsets the savings.
Continuing the word processing example, you might find out how much time is spent doing word processing in a given period. Then derive some percentage time savings of using Word vs Notepad. By applying that %age to the total cost of word processing, you could show that as the benefit.
I've found that, especially in a large company, the cost savings is often not the ultimate determinant of whether a project is accepted, but rather for some political motive - i.e. makes the customer (internal or external) happier or maintains some relationship with a vendor. This may not apply as much to a "techie" back-office upgrade, however. Most of the time, the assumptions are complete BS and the project managers just come up with something that the execs want to hear to make them feel justified in approving the project.
Nice that you can get out for a round with the CEO - lucky dog. ;D
hulkster:
--- Quote from: ChadTower on May 01, 2007, 04:20:36 pm ---
What you're asking is pretty much "what do I learn from an MBA program", if that helps any. They're not simple questions to answer.
--- End quote ---
heh, yeah thats probably what i need...but i was looking for something more on the FREE variety ;D
--- Quote from: Chris G on May 01, 2007, 04:41:58 pm ---I'm not a network admin, but I used to do financial analysis for IT projects like this at our company. You will likely need help from someone in your Finance department to do this with any credibility.
Most of these projects do not MAKE money, they SAVE money, as you said. So you need to look at which costs could be impacted... labor, contractor costs, licensing, etc. and come up with some relevant metrics which can be translated into periodic cost savings. Of course, you also need to take into account the costs to implement (capital) and maintain (expense) the new solution, which offsets the savings.
Continuing the word processing example, you might find out how much time is spent doing word processing in a given period. Then derive some percentage time savings of using Word vs Notepad. By applying that %age to the total cost of word processing, you could show that as the benefit.
I've found that, especially in a large company, the cost savings is often not the ultimate determinant of whether a project is accepted, but rather for some political motive - i.e. makes the customer (internal or external) happier or maintains some relationship with a vendor. This may not apply as much to a "techie" back-office upgrade, however. Most of the time, the assumptions are complete BS and the project managers just come up with something that the execs want to hear to make them feel justified in approving the project.
Nice that you can get out for a round with the CEO - lucky dog. ;D
--- End quote ---
well i dont want to read off total BS if i can help it. the numbers the other depts. put out are not BS, because they can actually chart how much product they sell. if i deploy a faster printer, its hard to say "hey Mr. CEO, this printer helped us sell 3.5 more units".
--- Quote from: Chris G on May 01, 2007, 04:41:58 pm ---
Nice that you can get out for a round with the CEO - lucky dog. ;D
--- End quote ---
yeah he's a huge golfer, and has memberships at several different courses so when we play (not just me...its others as well so im not THAT special) he puts lunch and beer on his tab. its very nice. :notworthy: :cheers:
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