At the Ework summit in May of this year, many of you provided feedback that a ROI calculator was a tool you needed but couldn’t find. We did find some ROI calculators out there but felt that they weren’t applicable to every business case or didn’t look at a work at home program in a holistic way.
Since then, we’ve been working diligently to create a ROI calculator in a format that was complete, but flexible enough to be augmented to more accurately express different business goals and objectives. We also had a goal of creating a tool that took a holistic approach to work at home and encourage different departments to share feedback and data.
Before I go any further, I want to thank Ruth O’Brien and Steve Greenberg for contributing to the creation of this calculator. For those of you at the Ework Summit you’ll remember that Steve is the Co-chair of that event. Ruth is a senior contact center consultant that has an extensive background and expertise in contact center management.
For now we’ve selected to keep our calculator in an excel spreadsheet format. This allows us to adjust some of the formulas to account for different organizational metrics. We feel this will be especially necessary when looking at data measuring revenue or the productivity. We’ve also constructed this tool into, what we hope, is an easily understood yet complete four step process.
Step 1: Analysis
The first step is an in-depth analysis of the business. The ROI Calculator encourages you to take a look at all facets of the business when assessing the impact of work at home on your organization.
The data requested includes:
- Salary/Hourly Wage of the employee
- Benefits Cost as a percentage of salary
- Number of Teleworker you want to send home
- Total number of employees
- Revenue/Production of employee
- Average Cost Per Hire
- Average Cost to train
- Square footage of your facility
- Monthly lease cost for the facility
- Current Turnover
- Turnover or attrition goals
- Current average attendance goals
- Average attendance goals
- Maintenance costs for facility
- Utilities cost for the facility
- Square footage the average employee takes up in the facility
- Productivity goals
- Costs for desktop maintenance
- Cost for work at home employees desktop maintenance
- Home network costs
In this analysis you have the concerns and goals of HR, operations, leadership and IT expressed. It will take some time, effort and communication with all these departments to understand how they currently measure this data and collect it.
Step 2: Annual Costs
The calculator will have broken down the cost of facility maintenance, the cost of utilities, the monthly lease cost, network costs and desktop maintenance per agent. The calculator compares your costs to support the employees working in your facility to the costs to support the work at home employee.
There may be other monthly costs you need to consider. The calculator will allow you to manually enter them. These may include software licenses, equipment leases and VPN licenses.
Step 3: One Time/Capital Expenses
To optimize and insure that a work at home program is effective and scalable, typically some investment is necessary. Adding new servers, purchasing new thin clients, VDI, Virtualization of applications, virtual storage and reassessing voice solutions are all IT areas that may require some capital expense. Investing in studies focused on successful leadership and the characteristics of the home employee may necessary. Other areas are project management and consulting that provide some assessment of your organization’s readiness for work at home.
There are other one time expenses that could also be eliminated. Chairs, desks, lighting, printers, copiers, PC’s and laptops are a few of the obvious examples.
Step 4: 12 Month ROI
The last step is a simple one. Once the first three steps have been completed, the calculator has been built to provide 12 month return on investment data. The data includes a full analysis of the increase or decrease of monthly/annual costs and capital costs. Also, the calculator provides an impact of the benefits that should be derived out of a work at home program including: increase in productivity; increase in work hours and a decrease in turnover.
Recently, we completed a case study for a company virtualizing 150 call center agents. Some of the stated goals were to increase productivity by 5%, increase attendance hours by 2.5 hours a month and decrease turnover by 15%. We also found that it cost them $610 per month per agent to maintain an agent in the facility. This was taking the costs of the facility, facility maintenance, utilities, desktop support and network into account. In comparison, it only costs $150 per month to support one of their work at home agents. There were some one time and capital expenses required including costs for upgrading their Citrix solution, consultation and a study analyzing the current workforce. However, even with these additional costs that were in the six figure range over all one time costs in the first 12 months dropped.
The bottom line of the case study was this: the organization saw an ROI of $2.2 million in the first 12 months of operation. Although further study is necessary it looks as if the organization grows towards 400 work at home agents the ROI grows to exceed $ 7 million even with added infrastructure expense.
The value of the ROI is that it clearly expressess the goals and areas that need to be addressed by an organization as it moves towards virtualizing it’s workforce. It also communicates, in a meaningful way, to leadership and management the value of the program. Lastly, it justifies the investment needed to make your program successful.
If you would like to get a copy of the calculator please reach out to me. We’d by happy to share the tool. My contact information is below: