Hi,

I recently wrote an article on measuring the benefit of CMS (shameless self-promotion) at (NB link in 2 halves...) http://www.zdnet.co.uk/news/specials/2000/10/ [link continues...]
enterprise/ techrepublic/2002/03/article004.html

Here's a brief summary of the gist of the article:

Justifying the business expense
Business justification typically involves making a case for a significant capital investment by proving to upper management that the initiative in question—in this case, a CMS—will either help the company save money, or make money, or even both.

How much will CMS cost my company?
Tony Byrne (whom I interviewed for my article) advises companies to consider three factors when estimating the costs of a CMS:

- Software licensing (including databases, search engines, and other ancillary packages): Watch out for cost creep as you add additional servers and content contributors. The most important thing to remember is that software licensing may well turn out to be the least of your expenses.

-Integration, customisation, and extension: Industrial-strength CMS doesn't come out-of-the-box: Hiring a professional services firm to help you put everything together may set you back one to three times the cost of the software licensing alone, depending on the scope of the engagement. Departmental installations of midmarket packages tend to run toward the lower end; enterprise projects will certainly edge up or above the 3X ratio.

- Data cleaning, normalisation, organisation, migration, and other kinds of prep work: CMS buyers typically need to do most of this themselves; everyone usually underestimates the level of effort involved. Interns can help, but it can still be a big job for regular staff too."

Calculating ROI
Byrne offers a simple formula for calculating ROI. The first step is quantifying costs and then adding up all the hard dollars and cents your company will see in:

- Increased sales.
- Expanded product/service deployment.
-Greater return from other IT investments (e.g., ERP, portal).
- Accelerated time to market.
- Process efficiencies.
- Reduced Web production costs.
- Reduced paper/mailing costs.
- Reduced human errors.

Then, quantify and add up all the "soft" benefits, which include:

- Putting business people in control of online communication.
- Maintaining brand consistency.
- Enhancing customer satisfaction.
- Improving content security and reducing legal liabilities.
- Maximising internal skills through greater specialisation.

Compare your costs laid out above against the benefits you expect to gain from a CMS. Although the benefits may be difficult to quantify at times, at some point, your company will simply decide that, ROI or not, it can't live any longer with the (likely growing) pain of not effectively managing your content.

cheers, geoff

On 11:47:23 13 December 2001 campus77 wrote:
>We are conducting a methodology in order to make a prior
>estimation on how many hours you can reduce (and calculate
>a ROI approach) with a CMS implanted. We have seen stats
>about how many hours are spend in every process when
>producing content for the different channels before and
>after a CMS, but don’t know the methodology being
>used in order to do so. Any ideas or suggestions?.
>
>Eduardo