ROI Basics

Calculating return on investment (ROI) for the docBlock is fairly straight forward. The main measurable productivity benefit the docBlock provides is the ability for multiple users to edit the same document at the same time. This means that documents that require the input of a team of people can be completed much more quickly and efficiently by having the team members work on each document concurrently, rather than requiring the rest of the team to wait while one person completes his/her portion of a document.

Concurrency Percentage

It would be unrealistic to claim that because you have five people assigned to a document, they could all work on it completely in parallel. Real world documents often have content dependencies among various sections.  The concurrency percentage reflects real-world limitations on which sections of a document can actually be worked on independently of other sections.

For most teams, the concurrency percentage is about 15%* (.15). This accounts for the fact that some sections of documents depend on other sections, and that some documents really are a one-person job.

Productivity Increase

This reduced wait time and increased team productivity is the basis for the measurable ROI calculation. Because the docBlock's ROI comes from the increased team productivity, the calculation for the productivity increase is the main component to calculating the ROI.

This formula for calculating the productivity increase is:
     (1 / (1 - {concurrency percentage})) - 1

Using the previous value for the concurrency percentage, we can calculate that the average productivity increase provided by the docBlock is (1 / (1 - .15)) - 1 or about 17%.

ROI

While getting a number for the productivity increase is great for resource planning and scheduling, it is not ROI. Investment and return on investment is done in dollars, not percentages. To turn the productivity increase into a dollar value, we need to apply the productivity increase to the cost of the investment and the expected return.

The investment is simple: it is the cost of the docBlock device. The return calculates how quickly the cost of the docBlock is offset by the productivity increase of the people creating documents using the docBlock.

The monthly dollar savings or ROI the docBlock provides is:
{team size} * {average yearly compensation per member} * {productivity increase} / 12

Assuming an average team size of five people, two teams using the docBlock, and an average annual compensation (salary and benefits) of $50,000 per person, we can calculate the monthly savings as 5 * 2 * 50000 * .17 /12 or about $7000 in monthly savings. 

Time to ROI

How long will it take for the docBlock to pay for itself? The point at which the docBlock has paid for itself, the time to ROI, is:
{docBlock cost} / {monthly ROI}

For the previous two teams of five people, this is $50000 / $7000 savings per month. This means that even with the conservative estimates in this ROI calculation, the docBlock will have paid for itself in about seven months.

Download the Enhancing SharePoint Document Management with Virtual Documents black paper (registration required). The black paper discusses several key document management usage scenarios enabled through docBlock Ascend's virtual document enhancements to the SharePoint platform.

For more information on the docBlock Ascend, please download the docBlock Ascend product brochure or contact sales@blackbladeinc.com / +1-703-260-1111 . See the docBlock Ascend in action by scheduling a live web demo, or attend a public webinar, Tuesdays and Thursdays at 2pm EST.

 *Concurrency percentage based on empirical data collected by Black Blade