The ROI of UX in Enterprise Software — Part 1:

Lower Development & Maintenance Costs through UX

When you are ‘in’ the User Experience field, or any field really, it’s easy to take information for granted. When we live and breathe something we often lose sight of the fact that not everyone else has read the 152 other articles about how a little investment in UX on a project can have a significant impact on the overall budget and success of that project.

UX is too often dismissed early on in a project in particular when things get down to the budget. Too often UX is seen as a luxury rather than a necessity that does not translate to the bottom line. The goal here is to change that misconception not with anecdotes but with solid information.

UX Helps Stop Wasting Developer Time

Dr. Susan Weinschenk, in her 2005 white paper Usability: A Business Case argues that up to 50% of programmers’ time is spent on avoidable rework.

By employing UX early in the life of the project you can more clearly define usability requirements up-front, helping to avoid unnecessary rework and giving developers and programmers a more clear road map of just what they are building.

UX Helps Reduce Development Time

According to Forrester research done in 1998 Usability techniques allowed a high tech company to reduce the time spent on tedious development tasks by 40%; at another company, usability techniques helped cut development time by 33–50%.

Early UX involvement helps to improve decision making and better prioritize dev tasks and once again provide a clear road map. Noticing a theme yet?

UX Helps Reduce Development Cost

Changes to project requirements increase by a factor of 10 at each stage in the project’s lifecycle. Correcting a problem at the development stage is 10x more expensive than fixing the same problem during the user-centered design phase.

Thus it becomes 100x more expensive to fix the project after deployment than in the development stage.

For example: Sun Microsystems has shown how spending about $20,000 on user-centered design could yield a savings of $152 million. Each and every dollar invested could return $7,500 in savings” (Rhodes, 2000)

This is also know as the 1:10:100 rule. Spend $1 on research or $10 to change design or $100 to change something in development. You would think that this is a pretty clear choice, wouldn’t you?

Calculating ROI

In her paper, Dr. Weinschenk outlines three useful equations for calculating cost savings related to:

Errors:

• (# of errors) x (avg. repair time) x (employee cost) x (# of employees) = cost savings
• Example: (2 errors/week) x (60 mins) x ($30/hour) x (100 employees) = $6,0000/week or $300,000/year

Cost of Development and Maintenance:

• (# of changes) x (avg. hrs/change) x (cost of developer) x (4, if late) = cost savings

Productivity:

• (time saved) x (employee cost) x (# of employees) = cost savings
• Example: (1 hr/week) x ($30/hr) x (1000 employees) = $30,000/ week or $15,000,000/year

Mic Drop

UX or user-centered design is nothing new. Its well documented value is hard to argue, and yet we still have organizations willing to cut UX as soon as the budget starts to get tight. It’s an interesting misconception that reminds me of a Warren Buffet quote:

“Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”

When the budget begins to shrink, that’s precisely when UX needs to be employed to ensure that the money that is left, is spent on the right things going in the right direction.

Sources:

Cost-justifying Usability: An Update for an Internet Age by Randolph G. Bias, Deborah J. Mayhew

Usability Cost-Benefit Models: Different approaches to Usability Cost Analysis by Mikko Rajanen

Benefits of User-Centered Design — usability.gov