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    1. Smart Buildings

    Online ROI

    Jan. 2, 2003
    Online Project Collaboration Returns On Material Costs
    In the building design and construction industry, as in other vertical industries, cost is a major factor for companies considering a new technology investment. But while cost can easily be measured for many physical business attributes and processes, calculating intangible soft costs can be difficult because of the multitude of variables introduced, especially when a company is considering an implementation as complex as an online project collaboration service. Hard costs – those that are easily identifiable and quantifiable for budgeting purposes – are readily measurable. Companies can easily determine outlays for such materials before and after a software/service implementation and therefore accurately measure return on investment (ROI) based on these hard costs. On the other hand, soft costs – those associated with non-tangible items such as staff productivity and communication efficiency – are not so easily measured and therefore can complicate an organization’s ability to accurately establish overall ROI.Return on Opportunity™ (ROO), a new return-measuring tool defined by Framingham, MA-based Hurwitz Group, is an approach to categorizing and quantifying the difficult-to-measure top-line benefits of new technology investments. ROO helps organizations identify areas in which technology implementations affect competitive advantage and business success. Some of the features that ROO addresses are improvements in revenue, productivity, and custom retention. Most organizations are familiar with or have established some methodologies for computing the impact of a new technology implementation on the overriding costs of business operations. The growth of the Internet and the increased acceptance of web-based collaboration services have introduced a number of hard and soft metrics that companies consider when establishing overall cost and determining ROI/ROO. In the building design and construction industry, some of these hard and soft costs could include those associated with production, printing, delivery, productivity, and time to revenue.Hurwitz Group took a qualitative and quantitative approach to the methodology of developing Autodesk Buzzsaw metrics for ROI, ROO, and total cost of ownership. The goal of the study for San Rafael, CA-based Autodesk Inc. (www.autodesk.com) was to provide comprehensive details on both primary hard cost benefits and secondary benefits, for its product, Buzzsaw. Through ROO and ROI analyses from interviews with a number of Autodesk customers, Hurwitz concluded the following savings and return on Autodesk Buzzsaw:Employee costs. Organizations realized benefits related directly to employee costs specific to project collaboration management and were, in many companies, sufficient to warrant the investment in a Buzzsaw implementation.Labor. Responding organizations realized actual labor effort and productivity savings related to Buzzsaw’s effect on the design, bid, and build phases.Soft returns. A high percentage realized ROO or soft return benefits after Buzzsaw installation, specifically associated with better communication, better quality, increased productivity, and reduced claims and litigation.Staff productivity. Organizations clearly reported monetary value in the use of Buzzsaw for increasing the productivity of staff and speed of communication.“Autodesk Buzzsaw Return on Investment” is a White Paper written for Autodesk Inc., San Rafael, CA, by Hurwitz Group Inc., Framingham, MA.

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