Have You Ever Wondered How Much Your Manual Tasks Cost & How Long To Achieve An ROI If You Automate?

 

Understanding The Numbers Will Set The Stage For A Good Strategy.

Let’s Start By Calculating Your Full-Time Employee’s Actual Hourly Rate!

 

Understanding the labor costs associated with each manual task is essential before determining if it is worth the investment to automate.

Follow the steps on this page to (Step 1) determine how much you pay the employees by the hour that are working to carry out the manual tasks within a workflow. (Step 2) Next, calculate what the manual tasks are costing the company in wages. (And Finally) Discover what your ROI would look like if you updated.

— Step #1 —

 
Calculate Your Employee’s “Actual” Hourly Rate!
 

We’ll Use The “Calculated Base Hourly Rate” For The Calculations In Step #2.

Now Let’s Calculate How Much Your Manual Tasks Cost The Company?

The software feasibility study is critical when it comes time to invest in making your company more efficient, move away from spreadsheets, and eliminate manual tasks and common errors. Before beginning the arduous process, you can get a good idea of how much your current manual tasks are costing you in wages using this calculator.

Calculate The Cost Of Your Manual Tasks Within A Workflow.

 

Not Sure Which Tasks Can Be Automated?

 

Not all workflows can be completely automated, so let’s identify the areas that can!

First, the link below will help you identify all the tasks within a workflow and determine which can be automated. Once identified, you can calculate the total time the tasks take to complete, from start to finish. Finally, you’ll be able to add up the time and use these numbers to determine an estimate of how much you can save by automating.

Use this link to instantly identify manual tasks that should be automated (Click Here)

— Step #2 —

 
Calculate “The Cost of Your Manual Tasks” And Put A Value On Automating!
 
Current Cost Estimation Of Manual Tasks Within The Workflow!
These numbers relate specifically to the labor costs associated with the manual tasks within a single workflow.
Consider having Intertech automate and combine multiple workflows for further savings.

Finally, Estimate How Much You Will Save By Automating The Process!

Important Note: If you don’t have an estimate for the work, enter an idea of what it may cost to update or let us provide one for you!

Ask yourself, how much are the manual errors costing the company, and could we be doing more work more efficiently if the process was automated? Then, tell us what you are doing and we’ll let you know if and how we can help.

Not Sure Which Tasks Can Be Automated?

 

Not all workflows can be completely automated, so let’s identify the ones that can!

First, the link below will help you identify all the tasks within a workflow and determine which can be automated. Once you identify the tasks, you can calculate the total time the tasks takes, from start to finish. Finally, you’ll be able to add up the time and use these numbers to find out how much you can save by automating.

Use this link to instantly identify manual tasks that should be automated (Click Here)

Where Should You Start?

Determine Your Company's Appetite For Automated Improvements.

Determine the mood of your organization toward automation. Buy-in from key stakeholders is required. Business Process Automation changes how work gets done and can generate fear that jobs will be eliminated rather than create a more efficient and enjoyable workplace. When considering ROI, make sure to calculate it over a realistic period, understanding that your business will need to rely on automation to stay competitive.

Identify Processes That May Lend Themselves To Automation.

There are two items to consider. (1) The first is which processes are repetitive. The repetition can be spread over hours or days, but a job is typically based on repetition. (2) The second item to consider is what is being generated from the process. Typically it is data, and when data is generated and collected in the correct form it can be used for completing the process, forcasting, and modeling past results. Make sure to onsider all steps within the workflow.

Identify Specific Steps Within Each Targeted Process For Automation.

After identifying potential processes for automation, outline the specific steps within each process. Once clearly outlined, consider areas within these steps for improvement or elimination. Once drafted, try and identify the time to enact, from beginning to end; this will allow you to calculate the time saved by automating the entire or portions of the process. Finally, take care in evaluating each step so you can determine if it is worth the investment to automate.

Identify Quick Wins And Areas For Long-Term Expansion And Sustained Growth!

To show the benefit of automating your manual process, in the beginning, select small projects that contain processes that take up considerable time but deliver significant returns. Success leads to more success and cross-organizational support. In addition, think ahead to where automation can impact growth. Finally, automation allows communication between departments and leaders making important decisions.

Additional Expenses Relate To Your Tasks, But The Future Is Efficiency.

It is essential to understand that parts of a workflow will always include manual tasks, and your feasibility study will discover additional costs that offset some savings. However, no matter what you find in the end, business is changing, and the more automation you can include in your daily task load, the more efficient you will become, impacting the bottom line.

Consider speaking with Intertech. We can help you assess your workflow and help develop a plan that fits your budget, your IT department’s vision, and does exactly what you need.

FTE Productive Hourly Rate Calculator
THIS IS THE ACTUAL PRODUCTIVE COST OF YOUR FULL TIME EMPLOYEE (FTE) AND THE NUMBER TO USE WHEN COMPARING OUTSOURCED RESOURCES HOURLY RATES TO FULL TIME EMPLOYEE RATES – ILLUSTRATING THAT INTRODUCING A “HIRED GUN” FOR THEIR IMMEDIATE EXPERTISE CAN BE COST EFFECTIVE.

100% equals an 8-hour day without breaks, 87.5% equals a 30 minute lunch break and two 15 minute breaks while the rest of the day is productive.

Universally Accepted Productivity Rates:

• Freelance Developer = 96%-98%
• Consultant Developer= 96%-98%
• Full-Time Employee – Developer = 74% to 81%
• Full-Time Employee – Base = 37% to 47%

It is important to remember that corporate required training, events, seminars, expectations, oversight, and other factors take away from actual work and lower the productivity rate of a full-time employee, while an outsourced freelance and consulting resource’s hourly rate is based on a much higher productive rate per hour due to the nature of their position and expectations (typical rates listed above).

FTE = Full Time Employee


RESULT: Employees Productive Hourly Rate (PHR)

PHR is the rate that you should use when determining (a) what you are actually paying your employee for work accomplished, and (b) the number you should use to determine cost of project development, and when comparing an outside resource bid.
 

DEFINITIONS:

Base Salary

Base salary is the paid to an employee, not including any benefits, bonuses, overhead, G&A or raises.

Direct Expenses

These are the expenses related to the employees base salary paid by the company that go beyond the base salary but should be included. Direct expenses include:


    • FICA & Unemployement = 9.5%
    • Medical Insurance = 7.1%
    • Dental & Other Incidentals = 1.5%
    • Retirement 401k Match = 3.5%
    • Bonus = 6.8%

NOTE: If your calculations are different then these, feel free to enter in 0% to 100% depending upon your company’s rates. For Example: – if your “bonus = 15%” and your “401k match = 6%” then together they equal 21%. Next, subtract our number of 10.3% from your number of 21% and add the difference to our preloaded number of 28% (28% + 10.7% = 38.7% for direct expenses rate) .

Indirect Expenses

When determining what a workflow actually costs, or comparing apples to apples between full-time vs. outsourcing (consultants have these figures included in their hourly rate), these are the expenses that are often forgotten as required costs of doing business and having an employee on staff. Indirect expenses include:


    • CEO
    • CFO
    • HR & Recruiting
    • Finance Department
    • Marketing
    • Sales
    • IT

      • Hardware
      • Software
      • Lincense/Fees
      • Support


    • Infrastructure

      • Mortgage & Interest
      • Property Taxes
      • Utilitiess
      • Office Furnature
      • Facilities Expenses

    • Supplies & More

    NOTE: If your calculations are different then these, feel free to change the percentage to fit your company’s overhead & G&A. For Example: According to a 2018 Deltek survey (source) that included 638 respondents, in companies listed as Small (under $20 million), Medium ($20 to $99 million) and Large (over $100 million), and included over 90 questions, found the average indirect expenses for the different company sizes came in at: Small Business = 56%, Medium Businesses = 57%, and Large Businesses = 48%

    Actual Salary

    Base Salary plus direct and indirect expense determine “Actual Salary.

    Based on 2080 hours in a year (260 work days x 8 hours each day) — Minus 168 hours for paid vacation (21 days) — Minus 64 hours paid holidays and (8 paid holidays) = 1,848 — Adjust to fit each employee’s specifics.

    Calculated Base Hourly Rate

    “Actual Salary” divided by “Maximum Hours Available.” based on 100% productivity

    Estimated Daily Productivity

    (See above notes)

    Employees Productive Hourly Rate

    Outsourced resources tend to be at a 96% to 98% productive rate due to the nature of their role. Full Time Employees (FTE), based on multiple research articles and data, tend to run between 37% and 78% productive within an 8-hour work day, depending upon their job description. THIS IS THE NUMBER TO USE WHEN COMPARING OUTSOURCED RESOURCES HOURLY RATES & ESTIMATES because their rates include all direct and indirect expenses.

    It is essential to keep in mind that not only does the automation of a workflow or processes save you time and the salary costs as displayed above, but automation also eliminates manual errors and opens the door to the economy of scale, that is often the key ingredient in payback!

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