This January and February, I discussed the first two of “Three R’s”: writing and reading. Now, let’s move to the third (but equally important): Arithmetic.
(Incidentally, calling them the Three R’s does not mean that the words all start with the letter “R,” but rather that they have a heavy R sound in them. In fact, the word “arithmetic” is thought to have been “reckoning,” once upon a time… but I digress…)
Reckoning is the use of mental math – of solving a problem in your head without the need for paper and pencil, or Excel. You use reckoning when you calculate a server’s tip in a restaurant or the sales tax on a purchase. We may even use “dead reckoning,” which is based on a calculated guess, such as estimating an arrival time when you are driving from one location to the next.
I do arithmetic in my head to help me figure out approximate numbers all the time. When asked what 12% of 150 is, this seems hard to figure out at first. But breaking it down makes it easy. 12% is 10% plus 2%. So 10% is easy to figure out just drop the last zero to get 15. 2% is easy to figure out if you think of it as multiplying and then dividing by 100. So 2 times 150 is 300, then divide by 100 (slice off the last two zeros) and you get 3. So 12% of 150 is 15 plus 3 which is 18. You can do most of this in your head. If the number is not easily divided, then just round off. All you really need is to get close. So if the number is 158.5 then round up or down to 155 or 160. Make it simple so that you can get close. Most of the time when doing math in your head, you just need to get close.
When it comes to the Three R’s, Writing and Reading relate to the process of representing ideas in the form of words. Arithmetic, on the other hand, speaks to the representation of an idea using numbers. While most of the time a CAD/BIM Manager will be using words to convey their ideas, there are plenty of times when numbers have a greater impact than words.
You will need to use numbers to justify purchases, demonstrate reductions in repetitive actions, or any other mix of managerial communication you can imagine in your job. For this article, let’s take a look at just these two.
ROI is the best way to represent the reason for making a purchase. There are many reasons apart from money that come into play, but there will always be a need to justify the purchase of any piece of software based on the cost.
To justify a purchase accurately, you have to calculate the cost of the purchase compared to the benefit (increase) and savings (decrease).
Let’s use Adobe Acrobat – cost $449 (full list). How can you use numbers to prove your case to buy the program.
You need to purchase the software to generate PDF’s and combine PDF files created elsewhere. You don’t have another tool that can do this as effectively across your firm. You spend 2 hours a week doing this kind of task-work with other, less functional tools and your average staff cost is $35 per hour, so your per week cost is $70 per employee for just this task alone ($35 per hour x 2 hours). Two people in your office are doing this function and they could share the software on a shared machine that is open to them and others. That makes it $140 per week spent at this time. With Acrobat, you can reduce this time down to .5 hours per week for the two people. A reduction of 3 hours in total. 3 * $35 = $105 savings. Take the $449 price and divide it by the cost savings per week and you get 4.27 weeks to recoup the cost.
Starting in the 5th week – you are saving money.
That is how a few, quick calculations can help managers justify spending money – just from a financial sense. It does not account for the benefit of employees doing other, more productive tasks (what economists would call an opportunity cost) and the general avoidance of frustration by your staff.
If you like, you can set up a spreadsheet:
Demonstrating Reductions in Repetitive Actions
Let’s say, as a manager, you notice that you have trouble with people creating new layers that have not been defined before or documented, or that the User is unaware of.
The User has to call up other files and look to see what others have used as a layer name. They may also just “ask around the office” by talking to the person next to them. They may also have to get out of their chair and go see someone or make a phone call, text chat, or IM. At the worst case, let’s say this takes 2-5 minutes for each layer name.
Let’s say that your User needs 2 new layers per drawing. That would give us 9 minutes total per drawing max, 3 minutes minimum.
If your average drawings in a set is 150. And you “guess” that 10% of the drawings need new layers, you would have 15 drawings seeing an impact. That is 135 minutes per project which equates to 2.25 hours. If you have 30 projects a year, you have wasted 67.5 hours. Even at the minimum time it takes to find the layer name (3 minutes), you would see a return of 22.5 hours per year.
If you want to think in dollar amounts then, at $35.00 per hour, you would save $2,362.50 per year just by defining/documenting/communicating layer names better.
What we see is, if we can define the layers and educate everyone in the new names, or just make them look in the book - or better yet, program the menus to do it for them - you will have had a good return on effort for this task. Numbers make the managerial choice obvious.
Documenting your Numbers
For simple calculations, you can just write them out. Yet, don’t underestimate the impact of having a calculator with you. I have often attended budget meetings and financial discussions with a cheap desk calculator. Crunch the numbers on the fly right in front of people. They will get the point that you are serious about understanding the real return.
For more complicated calculations, you can use Excel or another spreadsheet. Getting the numbers mapped out and running multiple scenarios can help. Print out the results as needed and share them. For senior management, I typically do not dig into the numbers unless they have specific questions. Summarizing the numbers is good enough for them.
Taking the numbers out of your head and using them properly can move your efforts forward at times when your words do not convey the bottom line. Get out that calculator and make your move!!