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Gaining Management Support

Ann Rockley, The Rockley Group, Inc.

Identifying the Components of your ROI

Identifying Return on Investment (ROI) for your content management business case begins with a thorough analysis. This article reviews the information you need to gather to identify ROI for an effective business case for content management.

We are frequently asked to calculate return on investment for organizations wanting to implement content management. This task is made very difficult if you haven't done an analysis of your current costs, needs, and goals. Putting together an ROI requires that you analyze the issues you are currently facing, identify the opportunities you could realize by implementing a content management strategy, identify the goals that content management can help you to meet, then gather metrics that compare your current costs against the costs of implementing a CMS and the savings a CMS can help you to realize.

Analyze the issues

Analyzing the issues means taking a hard look at your organization. Identifying your issues helps you to determine the costs to your organization resulting from problems with your technology or processes. Every organization has issues. As tasks evolve, as workload increases, or as the market changes, processes that used to work no longer work. For example, one organization we worked with, we'll call them Corp ABC, learned that their marketing group maintained one set of content for traditional marketing delivery (e.g., newspaper and direct mail), the web team maintained another set, and customer support maintained a third. This came to light when during a recent information campaign, customer support had insufficient information, sales staff were confused, and because of inconsistent pricing information, costs were excessive for some contracts. They estimated the costs of the inconsistent and confusing information and extrapolated it across the previous year and upcoming year's planned product releases. Quantifying the cost of issues in this way is extremely helpful in determining your ROI.

Identifying goals

Unless you can clearly state how a unified content strategy and content management will help your organization reduce time-to-market, reduce costs, increase productivity, or whatever specific goals you have defined, you cannot effectively justify it. What are the goals in your organization? Can you quantify them? Your goals may be related to your opportunities; in fact, many of your opportunities can help you to create specific goal statements. Determine goals by examining strategic plans, and by asking key people what their specific goals are for the coming year. It is important to have long-term goals as well. You can also look at two-year, three-year or even five-year goals. In fact, many organizations have five-year strategic plans, broken down into what they hope to accomplish each year. For example, for their first year's goal, Corp ABC decided to unify the content between the web site and customer support to ensure that it is consistent, accurate, and equally available to customers and customer support. In two years, they expanded their goal to unify the web and customer support with product documentation and training materials. Corp ABC can now identify the value of the goals by estimating the value of the opportunities.

Identify your opportunities

As you analyze your business issues and needs, you can identify the opportunities your organization could realize if you are able to change the way you do business. Opportunities can include everything from streamlining authoring and review processes, thereby getting your product to market faster, to enhancing the usability of your web site, thereby increasing customer satisfaction, and potentially, your market share. For example, Corp ABC identified opportunities to reduce support costs (consistent effective content results in reduced support costs), reduce contract costs (correct, consistent information would be used), and increase customer satisfaction (a little harder to quantify, but they used a figure to indicated increased sales). Once you identify your opportunities, you need to determine what your opportunities are worth.

Hard cost savings

The easiest costs to calculate are “hard” costs. If you translate your content, how much does it cost you to translate now and how much do you think you could save (based on the percentage of content reuse)? How many people are responsible for creating content now? What is the average cost of their salaries? What percentage of their time could you free up to essentially create new resources? Could you save on contractors? How much would those savings be? Look for any costs you already have quantified and determine how to include them in calculating your ROI. For example, Corp ABC knew the costs of customer support. They calculated a 10% reduction in those costs as part of their ROI.

Gathering metrics

Most organizations know their hard costs like the cost of translation, cost of printing etc., but we frequently find that organizations don't actually know how much it costs to perform a task. For example, one company we worked with wanted to reduce the time it takes to produce content for new product releases by 30%. However, when asked how long it currently took them to create the content, they had a general timeframe, but were unable to identify specifically how long each task within that timeframe took. While you can use “guesstimates”, your guesstimated figures may not be valid. When building a business case that shows potential ROI, it is preferable to be both as accurate and conservative as possible. You do not want to create unrealistic expectations.

If you don't have metrics, consider using an existing project and tracking the time it takes to perform all the tasks related to it. That way, you can actually quantify the time it takes to perform tasks.

Determining the investment costs

Once you know what your costs are for creating, managing, delivering, and translating your content you need to calculate the investment costs. Investment costs include:
  • Authoring tools

    If you are moving to structured content you will need to buy new tools, upgrade your existing tools to a structured version (e.g., Word 2003 or FrameMaker 7.0), or create forms for your authors to complete.

  • Content management system

    What is your content management system going to cost? If you are looking at different systems with varying costs, pick the most expensive cost to use in your ROI. It's better to overestimate costs than to underestimate them.

  • Training

    Training the people who will use the system or maintain the system is critical to the success of your project. Make sure you calculate the costs of training as part of your investment costs.

  • Consulting

    There is a good possibility that you may need consultants to assist you with content analysis, modeling, information architecture, DTDs and style sheets, forms creation, system configuration, etc. Include some consulting dollars in your calculation.

  • Lost productivity

    Don't forget lost productivity. You will need to devote some of your existing staff to the project itself to help with all the analysis, design, and implementation, which will reduce their current productivity. In addition, users will be slower using the new processes and technology until they become familiar with the system. This will also affect your productivity.

Calculating ROI

Return on investment is potential savings minus potential investment costs. Once you've gathered all your information and done the math, you can determine if your figures justify a move to content management and a unified content strategy. Be conservative. While you may in fact realize a high return on investment, when you are building your business case it is better to be conservative so that you do not create unrealistic expectations. Management appreciates a realist ROI rather than an unrealistic one.


Gaining management support for content management often means being able to show the potential ROI and to put together an ROI, you need to do some solid analysis up front. Analysis includes identifying the issues you are currently facing, the opportunities you could realize by implementing a content management strategy, as well as the goals that content management can help you to meet. Once you've identified issues, opportunities and goals, you can gather metrics that compare your current costs against the costs of implementing a CMS and the savings a CMS can help you to realize.

ROI is the anticipated savings after subtracting the investment costs. While it's critical to perform a thorough analysis of your current costs and potential savings, remember to include technology as well as human investment costs (training, lost productivity) to ensure that you reflect the whole cost of investment. Be conservative with your potential savings to ensure that you create a realistic ROI.

Copyright 2004, The Rockley Group, Inc.