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Great cost benefit studies make great executives.

There are two distinct differences between the most successful executives and those that get  mediocre results.

  1. Great executives' consistently sponsor those initiatives that are their best,  highest ROI producing options. They only bet on winners. They know how to identify winners.

  2. Great executives demand fact-based cost benefit studies, tools, and blueprints that optimize their ROI ratios. They know how to make winners.

Every expenditure today requires precise cost benefit calculations to make the business case for approval. But accurate cost benefit forecasts also set realistic expectations that determine whether your project, and you, will be judged as successful.

We're experts at building cost benefit analysis models in complex operations like banking and insurance. Our clients are some of the world's most demanding companies that are known for their fact-based cultures.

Our cost benefit models will not only precisely calculate your cost and benefit metrics but they will also optimize your ROI by helping you discover and assess opportunities to increase the operational value of your initiative. We will your cost benefit studies and business case, as independent CPAs and experts, just as your CPA certifies the accuracy of your annual report.

Within weeks you will have...

   Cost Benefit Analysis Models (CBAMs) that calculate the precise impacts of your project,
      including labor savings, process improvements, product innovations, and customer service impacts.
  
CBAMs that are easy to use by all departments, including Finance, IT, Operations, Product
       Management and Marketing.

   CBAMs  that increase revenue by identifying opportunities to make your products

       and services more competitive and profitable.

   CBAMs that optimize your ROI on new technology and re-engineering expenditures.

   Bullet-proof business cases with impartial cost benefit calculations that are the result of a

      collaborative approach with all stakeholders.

Cost benefit analysis models are sets of related charts and graphs prepared from an extensive database which provide detailed information so results can be precisely determined, easily understood and optimized.

Our cost benefit analysis models are both analysis and design tools that help managers optimize the ROI (return on investment) of an idea under study. They discover and quickly  analyze scenarios you would never have considered. You will play "what if" with a variety of scenarios to determine the best design that will achieve the highest ROI.  You will also optimize your project scope, approach, and schedule.

Costs are easy to assemble. It's the benefits that are tough, especially benefits like work reduction savings, service quality improvement, and increased revenue and profits from increased revenue producing activities. Far too often, cost benefit calculations are not comprehensive or impartial. A weak approach and methodology produce misleading conclusions that ultimately cause failed projects.

Our Cost Benefit Models deliver precise cost benefit calculations, optimize your ROI (return on investment) and bullet-proof your business case.

image of a cost benefit chart

This cost benefit analysis chart summarizes:

The cost of a technology project (the red line).
The operational savings (green line).
The cash flow (black line) moving from negative to positive as the project
    achieves ROI (return on investment).

The BE (break even) point was 11/05 (November of 2005) 11 months after it started.
The project has cost $3 million to date
This project has reduced operational costs by $9 million so far
The project has earned $6 million, for a 300% ROI (return on investment).

 

 

 

 

 

 

 

 

 

Cost Benefit Analysis Case Study

Summary: This national bank engaged Orient Point Consulting to build cost benefit models that would provide the information needed to analyze, optimize, and predict the value of automated transaction status messaging to its clients. It achieved an annual operating cost reduction of $14 million with a technology project cost of $2.1 million, a 666% return on its investment. The bank's customers were quick to recognize the value of immediate transaction status messages. It was the first bank to offer it's clients transaction confirmation emails and voice mail messages.

This National Bank knew it had lost-productivity costs and poor service quality problems that were caused by "follow up" and inquiry reply activities that were required because its systems did not provide transaction status information for any of its 270 banking products. They could easily determine the costs of adding status functionality to their systems but they could not determine which product systems needed this functionality the most or quantify the cost savings if they modified their systems.

The Operations and IT departments engaged Orient Point to deliver operating cost benefit models that provided time and cost information about all "follow up" and "transaction inquiry reply" activities. These cost benefit models calculated the operating cost reductions and improvements (benefits) that automated transaction status messages would achieve. The exhibit report below was part of this model.

Using these cost benefit models, a collaborative team of operations and IT staff were able to determine the specific labor cost savings that would be earned if transaction status functionality was added to each of its systems. This "what if" analysis was completed in 3 days using their cost benefit models. They determined that 91% of their follow up labor costs could be eliminated by adding automatic transaction status messaging to eleven (11) product systems.  This bank's managers determined that they would reduce their follow up and inquiry reply activity costs by more than $14 million per year. The IT costs of the status messaging functionality would be 2.1 million in the first year and $300,000 annual maintenance thereafter.

They proceeded to implement the system enhancements that provided receipts of transaction requests, confirmations of completed transactions, and the status of pending transactions. They booked operating cost savings of $11 million during the first 12 months and reduced operating expenses by more than $14 million thereafter. They also improved their customer service and saw their customer retention improve, which increased profits as well. The automated transaction messages were frequently mentioned by their customers in focus groups as high value and the reason they were keeping and/or increasing their business.

technology cost benefit chart

 

Cost Benefit Analysis Models

Cost benefit analysis models will provide you with detailed and precise cost, time, and incidence metrics and measurements. They are built with Activity Information Modeling methodologies and technologies that include the only costing methodology that the United States federal government recognizes as valid.

Project Phases & Deliverables

  1. Model Design: We work closely with your team to design the array of cost benefit data models your project needs.

  2. Data Collection: Our data collection systems collect data from your operations over 2 weeks or as long as  needed depending on the nature of your operation. Our systems collect data in your operations' local language and simultaneously create a mirror image data model in English or your own home office language. It's common for us to build cost benefit data models in multiple countries, in multiple languages, with thousands of employees.

  3. Cost benefit analysis model preparation: We prepare your cost benefit models within one week and deliver them as Microsoft Excel worksheets.

  4. CBAM Review: We review each model, chart and graph with your project team to make sure you understand the information and how to best use it to optimize your business case & plans. We teach you how to conduct your scenario analysis, playing "what-if" with your opportunities so you maximize your project's ROI (return on investment).

Are you risking your project or your career?

Let's discuss your project's difficulties and objectives. We were founded in 1998 and we have delivered thousands of cost benefit models to companies in over 30 countries. There's a 99% chance that we can show you how other similar organizations solved similar problems and the results they achieved.

You'll learn a lot more by seeing case studies with exhibits and demonstrations of our methodologies and technologies. Call us today at (631) 949-2300 or request a CB models web meeting.
 

 
 
 
Orient Point Consulting LLC
100 Park Ave., New York, NY 10017
clientservices    (631) 949-2300

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