Credits and billing
Explaining the cost to management
The figure does not convince on its own. What convinces is what it is compared against.
When someone in management asks what this costs, the usual answer is a monthly figure. And a figure on its own, with nothing beside it, always looks expensive: there is no context to judge it against.
The three comparisons that work
| Comparison | How to calculate it | When it convinces |
|---|---|---|
| Hours recovered | How often it was done by hand × time × hourly cost | Always; the easiest to accept |
| An incident avoided | What the last documentary problem cost | When there was a recent one everyone remembers |
| What a client requires | The contract that is not signed without this | The most powerful, and the least used |
Important
The third turns the conversation from cost into requirement. If a large client demands to audit your documentation, this stops being an efficiency improvement and becomes a condition for invoicing that client — and that is no longer discussed at the same table.
How to prepare it without inventing anything
- 1
Count the real work it replaced
"Chasing forty suppliers every quarter" is measurable; "we are more organised" is not.
- 2
Use real consumption, not estimates
With the breakdown. A figure that can be opened up gets questioned less.
- 3
And say what has not changed too
It lends credibility to the rest and pre-empts the awkward question later.
Watch out
Do not promise headcount savings. They almost never happen — people stay, doing something else — and promising it turns a real improvement into a broken promise remembered for years.
What management usually asks
The third is the one always worth being able to answer. A tool that is paid for and unused is a cost; one used daily by fifteen people is infrastructure.
Worth knowing
If consumption is split between group companies or departments, bring that breakdown too: many objections disappear when each area sees its own instead of an abstract total.
›What if the saving is not obvious yet?
Say so: three months in, the honest thing is to show usage rather than return.
›How do I value an avoided risk?
With what it cost last time it happened, if you have the figure.
›Should the full breakdown be shown?
Yes. What cannot be opened always looks more expensive than it is.
A real case
The situation
A manager presents the monthly cost and management finds it high.
What you do
- Adds the chasing hours it replaces and their largest client's requirement
What you get
The conversation shifts from what it costs to what would happen without it.
The situation
The cost is explained without comparing it to anything.
What you do
- Compares it with the hours previously spent
What you get
The conversation has two figures.
The situation
Management asks what is obtained in return.
What you do
- Brings consumption alongside the period's output
What you get
Cost is read next to what it produced.
The situation
One month's rise is presented without context.
What you do
- Explains which campaign or process caused it
What you get
The spike stops being an alarm.
The situation
Nobody knows which department consumes what.
What you do
- Presents the breakdown by department
What you get
The conversation happens with each of them.
The situation
A reduction is asked for without knowing where.
What you do
- Shows which activities weigh most
What you get
The reduction is decided on a basis.
This article answers
- justifying platform spend
- return on documentation investment
- defending the budget
- comparing cost with what it saves