On 7/8/2014 8:57 AM, Dave Salt wrote:
You say "save". Management, at least here, would translate this into
"real savings" this by firing nine or ten developers. That is true
"saving". "Saving" money by not hiring a new employee is not "saving"
in their world view. "Saving money" is "reducing cost". It is not
"eliminating future costs". Productivity is the responsibility of the
individual programmer. Or, "a poor workman blames his tools!" (or lack
thereof).
I hear you, and I've heard that same argument many times. But it makes absolutely no
sense to me. If we take the example of a company that spends 10 million dollars a
year to employ 100 mainframe developers, and that company licenses a tool that
improves productivity by 10%, that's a REAL saving of 1 million dollars a year no
matter how you look at it. Less of course the cost of licensing the tool; let's use
$8,000 a year as an example <g>.
Once the tool has been licensed the company can immediately fire 10 employees
and get roughly the same amount of work done. Doing this results in a REAL
annual cost saving of $1,000,000 - $8,000 = $992,000. Alternatively they could
let employees go through attrition and not hire anyone to replace them. For
example, even if only one of their employees leaves and doesn't do so until 6
months from now the company would still have a REAL cost saving of $50,000 -
$8,000 = $42,000. Meanwhile, their other 99 employees are all doing 10% more
work.
Even if the company keeps hiring people because they've got so much work to do, all of
their existing and new employees will be getting 10% more work done. This means projects
will be completed faster and at lower cost. If those projects are "charged
back" to end users (as they usually are), that's a REAL cost saving.
Maybe in addition to increasing productivity the new tool reduces things like
training costs, printing costs, CPU costs, storage costs, and more. Again,
these fit under the category of REAL cost savings.
A lot of tools also have 'soft' savings that managers don't even think about.
Maybe it helps solve production problems faster, which means there are less
outages and customers are kept happier. Maybe it helps deliver new features to
market faster than competitors, which helps the company thrive and gain market
share. Maybe it keeps employees happy so there's less turnover and less
rehiring and retraining. Maybe it reduces the need to spend millions of dollars
switching from z/OS to some other 'more productive' platform. These and many
more examples of 'soft' savings could be worth more than all of the 'hard'
savings put together.
To use an analogy, I pay an extra $5 a month on my phone bill for a
long-distance calling plan. I don't have to pay that fee, but it saves me at
least $50 a month in long-distance calling charges. Not paying the extra $5
would be foolish, and I think even children in grade 5 could understand that
simple logic. Incredibly, this seems much too complex for many mainframe
managers to understand.
I had the same problem with selling training. I even built a simple
little ROI (Return On Investment) calculator on our website; it's
still there:
http://www.trainersfriend.com/ROI/roi.html
but I don't think it helped sell a single class.
We once found some (many?) customers assumed it was more expensive to
bring us in from Denver than to use local people. Kitty showed them
that even though we included travel and living in our charges, we
were less expensive than most local vendors. That actually got us into
one customer in Seattle.
-Steve Comstock
Dave Salt
SimpList(tm) - try it; you'll get it!
http://www.mackinney.com/products/program-development/simplist.html
Date: Tue, 8 Jul 2014 06:59:38 -0500
From: [email protected]
Subject: Re: "Freebie" software
To: [email protected]
On Mon, Jul 7, 2014 at 11:48 AM, Dave Salt <[email protected]> wrote:
On Mon, Jul 7, 2014 at 9:35 AM, DASDBILL2 <[email protected]> wrote:
The loss of time is never "free."
I couldn't agree more. If it costs $100,000 a year to employ a mainframe
developer (salary, benefits, premises, etc.), then for every 100 developers a
company employs it costs a staggering 10 million dollars a year. If a company
can improve the average productivity of those workers by as little as 10%
they'd save 1 million dollars a year for every 100 workers. But many companies
would rather waste millions than spend a few thousand on tools that improve
productivity.
You say "save". Management, at least here, would translate this into
"real savings" this by firing nine or ten developers. That is true
"saving". "Saving" money by not hiring a new employee is not "saving"
in their world view. "Saving money" is "reducing cost". It is not
"eliminating future costs". Productivity is the responsibility of the
individual programmer. Or, "a poor workman blames his tools!" (or lack
thereof).
Dave Salt
SimpList(tm) - try it; you'll get it!
http://www.mackinney.com/products/program-development/simplist.html
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Maranatha! <><
John McKown
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