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Prove your worth!

By Geoff Hart

Previously published, in different form, as: Hart, G.J. 2001. Prove your worth. Intercom July/August:16–19.

Managers love statistics because numbers provide a potentially objective way to understand what's going on and, thus, represent a useful management tool. Unfortunately, the value technical communicators add to an organization is difficult to express statistically. That's a great pity, since those of us who can't prove that we add to the company's bottom line become expendable whenever the mad urge to downsize strikes the company. Simple common sense suggests we make sure our managers understand just how much we're worth. In this article, I've suggested ten measures (five quantitative and five qualitative) for estimating your worth. Each offers a more or less convincing argument that employing you generates enough value to cover your cost to the company.

Quantitative measures

For each quantitative measure I've proposed, I've intentionally chosen simplistic numbers to illustrate my calculations and make them easy to follow even for math-phobes. I've also based the calculations on what I've called "total salary"; this figure includes your paycheck, plus the additional costs of benefits packages, which can amount to an additional 50% on top of that paycheck. I make no claim whatsoever that these numbers are realistic, that they are universally applicable, or that they cover all possible costs; you'll have to collect your own data and perform similar calculations for your employer's unique context. In some companies, real numbers will be easily available, and you may need only a few of the five calculations to demonstrate your value. Some technical communicators, however, may have to combine several estimates to obtain a persuasive number.

The income you generate

Every dollar that a company spends to stay in business generates some quantity of income. If that income is less than the dollar they spent, the company loses money and eventually goes out of business. If the income exceeds that dollar, then the company earns a profit. The key point here is that every dollar the company spends is responsible to a greater or lesser degree for that profit. Although it’s tempting to assume that the same is true of the money spent on your salary, it’s exceedingly difficult to come up with a credible estimate of the company’s “return on investment” in your salary. Fortunately, you can approach this problem from a slightly different angle and come up with far more convincing numbers.

Consider, for example, the cost of printed documentation, which is an integral part of most products. Because the purchase price for a product must repay the production cost for the company to earn a profit, the product’s sales price is the result of multiplying that production cost by some markup calculated to generate a profit once all the sales are totaled. As it happens, the printed manual’s cost is also marked up because it's part of the production cost. For example, the $100 total production cost of a software package might include $2.50 to produce (write and print) the manual. Marking up that cost by 100% to create a $200 sale price means that the $2.50 cost of the manual is also marked up 100%: the manual then generates a total of $5 in income from each sale, of which $2.50 represents profit.

The cost of developers

Software and hardware developers are expensive—perhaps twice the cost of technical communicators. If we assume that each developer costs your company $100 per hour, while you cost $50 per hour, the company saves $50 per hour by having you write documentation instead of asking developers to do so. Estimate how many hours per year you spend exclusively on writing and multiply this figure by the difference in cost between you and a developer (here, $50 per hour). To these savings, add a fudge factor to account for the fact that you probably produce documentation much faster than an untrained developer; 20% would be a reasonable value.

If your company also tracks the value of developer hours, add this to the total. Every hour that developers don't spend writing is an hour they can spend developing the products that keep the company in business.

The cost of freelancers

Hourly rates for skilled freelancers range from $50 to $100 per hour, depending on the region and the skill level required for a given job. Let's assume that you're reasonably skilled at your work and that you know your company and product better than any freelancer who hasn't worked with the company for some time. With the exception of a few stars, it's unlikely the average freelancer will be significantly more productive than you.

This analysis yields two possible savings. First, the freelancer will cost anywhere up to $50 per hour more than you cost to produce the same documentation, in about the same amount of time. Second, the freelancer is unlikely to produce much useful work for the first week or more of employment, since it can easily take that long to learn the company environment, meet all the developers, learn the basics of the product, and so on. For a typical 40-hour week, at $50 per hour, this unfamiliarity adds $2000 to the cost of hiring a freelancer. (Before all the freelancers in the audience start screaming at me, I freely admit that as a wage slave, I've biased this particular analysis in my own favor. Freelancers who work outside your offices can actually be more productive since they potentially waste less time on staff meetings, answering telephones, and other hazards of office life.) [A look back from 2005: Now that I'm a full-time freelancer, and charge accordingly, I have more sympathy for the freelancer's perspective. But the original point remains valid.—GH]

The cost of third-party documentation

By all indications, the publishers of the For Dummies and For Idiots books and their competitors are making money hand over fist. So why not simply fire all the technical writers, purchase a large quantity of these third-party books, and bundle them with your documentation instead of producing documentation in-house? Here's why: A typical computer book costs the bookstore around $15 (half the retail price), but roughly half of that $15 represents marketing, advertising, shipping, warehousing, and other overhead at the publisher. The actual production cost of the book amounts to about $2.50 per book for printing, plus an additional $5.00 per book to pay the author, editors, and other staff at the publisher. The cost comparison appears in the following table:

Cost to the company

Third-party manual

In-house manual

Salary

n.a.

$50,000

Printing cost per book

$2.50

$2.50

Production cost per book

$5.00

n.a.

Total cost per book

$7.50

$2.50 plus $50,000 divided by the number of copies

Total cost for 10,000 copies of the book

$75,000

$75,000

In short, as soon as your company sells more than 10,000 units of its software or hardware with third-party documentation, purchasing this third-party documentation would cost them more per copy than if they simply employed you. The larger your audience, the greater the savings. To calculate the actual savings, calculate the total cost per book using the approach described in the table, and multiply that cost by the total number of copies you intend to print.

The cost of technical support

Various industry analysts have estimated costs of US$15 to US$25 for each call to technical support, so each call that you can prevent obviously generates a tangible savings. To figure out how much money you're saving your company per year, gather ten or so people in your company who you would consider typical users of your product, but not experts. Ask them to play with the software and identify things they can't figure out how to do without using the online help or printed manual—things that would prompt a call to technical support if the help or manual didn't exist. Combine the lists from each person and focus on the similarities: something that would prompt all ten to call technical support will probably affect your entire audience. Multiply the number of customers in your audience by US$15 (the lower of the two estimates per call) and calculate a total.

Let's assume 2000 users of your product. One call to technical support from each user would cost your company $30,000. If you can solve two such problems through helpful documentation, thereby eliminating the need for customers to call technical support, you've already more than repaid your own salary. Continue your analysis by adding proportionally the costs of other problems that would prompt calls to technical support. For example, if only two of your ten sample users (20%) agreed that they'd call concerning an issue, assume that 400 customers (20% of 2000) would call technical support, for a cost of $6,000 (400 times $15). Add the total technical support cost to your value estimate.

Qualitative measures

Qualitative measures are assessments that everyone, including your manager, "knows" are correct, and can provide anecdotal evidence to support, but can't quite seem to quantify. Mention them to support your case, even though they're less convincing than hard numbers.

Better reviews in industry magazines

Important industry magazines such as PC Magazine and PC World increasingly award points to good documentation, and their evaluations of products can have an enormous influence on the buying behavior of customers. Don't believe me? Take the following example, provided by the good folk at Ziff-Davis (originally published in early 2001 at: www.zdnet.com/downloads/deathmatch/firewalls/round1.html):

"Although personal firewalls are complex applications, they need to allow the average user to get them up and running with a minimum of fuss. Users should also have good help facilities and documentation at all stages… Again, ZoneAlarm takes the points. We think it's better documented for the average user, and we're concerned about Sygate's failure to include working Internet links in its documentation."

Recently, one participant in the techwr–l discussion group quoted a member of his marketing department on the value of winning an award for their documentation:

"…that would be one of the best sales touts in our industry. Prospects are constantly dinging companies on 'their lousy documentation' or lack of documentation. If you could win us an award we would take you out for beer for a month."

(Don't forget to add the local cost of those beers to your quantitative estimates of your value.)

Customer satisfaction

You can't buy better advertising than good word of mouth, in which friends and co-workers pass on their experience with a product to anyone who will listen. Every positive experience someone has with your software represents a positive review from a trusted source and, thus, a potential sale. For example, if you can impress an active participant in an online discussion group such as techwr–l to favorably review your technical writing product, that review could reach an audience of some 5000+ interested technical writers. (Discussion groups for larger audiences, such as pet owners or Star Trek fans, are considerably larger.) If your company has a marketing department, ask them what this much targeted advertising might cost, and consider adding those numbers to your quantitative estimates. Don’t forget to mention the consequences of negative reviews; folk wisdom claims that a bad review from an irritated customer can reach up to ten times as many ears as a favorable review.

Winning contracts

Documentation is increasingly a criterion in awarding major sales contracts. A colleague recently told me that he won a contract for his company against a powerful competitor simply by demonstrating that his company had quality documentation ready to ship before the competitor had any documentation available. If your company has a sales department, ask them what proportion of their sales come from contracts that require documentation as part of the purchase price, and consider adding those numbers to your quantitative estimates. Even if they don't have hard numbers, my colleague's anecdote bears repeating.

Safety and efficiency

A compelling reason to purchase your product is that it makes someone's job safer or more efficient by providing good instructions. Your employer should also consider the costs of product liability lawsuits resulting from poor documentation or documentation that doesn't provide adequate warnings of potential hazards. Demonstrating the role of your documentation in preventing accidents that might lead to such lawsuits gains important respect for what you do.

Better still, if you can document instances where you've added warnings or encouraged the product developers to revise procedures so as to prevent injuries, you have a strong case for how much money your company might have lost if you hadn't been present to spot the problems and remedy them through your documentation.

Environmental responsibility

All those printed manuals represent acres of dead trees, and with an increasingly environmentally aware public demanding accountability from manufacturers, it's obviously beneficial to minimize your consumption of paper. However, you shouldn't simply dump your paper documentation online and hope people will use it; odds are they won't, and most will simply print the online information at their own expense, thereby earning you more than your share of curses and creating a greater environmental problem than you solved by moving the docs online. (After all, most of us print online information on only one side of the page, thereby doubling paper consumption compared with a typical printed manual.) In contrast, converting paper documentation into an electronic performance-support system that's so well integrated with the software that nobody ever has to print it out will save your employer dollars by reducing the costs of printing manuals and will earn considerable goodwill from customers.

Moving documentation online can also generate quantitative data on your value. If you're in the process of converting paper documentation from previous versions to online support systems, start recording some hard numbers right now. Every page you shave from the previous version of the documentation has a clear cost. Let's assume that you formerly produced a 200-page manual that is now 100 pages long as a result of moving some of the information online. You've just cut your printing costs by roughly 50%. Find out from your accounting department how much the printing of the current document will cost: 50% of this cost provides a rough estimate of the amount you saved by cutting the manual's length, and this savings will repeat with each new release of the software.

Prove your worth

Applying these techniques can make a compelling case that the dollars spent keeping you employed are dollars well spent. My goal in presenting this article is to suggest ways you can think about your value, not to present calculations that would satisfy the most skeptical accountant. If you want to do this analysis more rigorously than my admittedly simplistic approach, consult the special issue of Technical Communication on value-added (February 1995), and the articles by See and Mead listed below. After all, several pundits have begun predicting an imminent economic recession across North America, and it's never too soon to start convincing people that you should be the last one to be shown the door.

Suggested readings

Mead, J. 1998. Measuring the value added by technical documentation: a review of research and practice. Technical Communication 45(3):353–379.

See, E.J. 1992. Moving to an entrepreneurial model: providing technical information services within a large corporation. Technical Communication 42(3):421–425.

Technical Communication, 1995, special issue: Measuring the value added by professional technical communicators. 42(1):23–93.


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