So, you are thinking about investing in a company-wide collaborative solution and are asking yourself: is it worth the investment? The answer is yes, definitely, it is worth every penny.
Reasons Why a Collaboration Platform is a Good Investment
While it is generally admitted that a modern collaborative intranet provides general benefits, a clear financial justification would help you to get all the skeptics on board with your proposal.
Our series of blog posts on the subject provides a step-by-step guide to where the cash benefits lie, how to estimate them and how to derive a clear ROI for a collaboration platform for your company.
Let us start with a quick overview.
- Financial benefits areas
The value of a modern collaborative intranet primarily lies in the following areas, which are relevant for most internal contexts and systematically lead to solid cash gains:
- Turnover improvement
- Increase in employee engagement
- Higher individual productivity
- Higher collective work productivity
In addition to the above, other significant cash benefits depending on each company context can be found in
- IT costs
- Document management costs
- Costs of internal communications
- On-boarding and knowledge transmission costs
Finally, when considering investing in a collaborative intranet, one needs to consider the financial benefits from achieving broader business goals, such as:
- Increase in sales performance (revenues)
- Customer service improvement
- Lower cost of innovation
In our future posts, we will dig into each of the above areas in detail.
- Financial benefits estimation: three principles
There are three ways to estimate the financial benefits of a new collaboration platform.
- Translate productivity into cash
A modern intranet is user-centered and allows employees to spend less time performing some tasks, which translates into less FTE for the same tasks or more productive and money-generating time.
- Find hard cash gains
A new intranet might reduce your expenses directly. For example, if you replace several collaborative systems with one, you will lower the cost of licenses. As another example, an intranet document management system might save you some storage costs. A popular intranet might also save you the printing costs for communications flyers. Etc., etc.
- Financial benefits from business goals
Find out what people can do together thanks to the new collaborative solution. It could be something that they could not do before or not as well. For example, a successful collaboration on a complex sale, having several business functions working in an efficient cross-department setting….
- Value of an intranet over time
This principle deserves a special point. The value of an internal collaboration platform is directly dependent upon the number of people using it and, therefore, increases with time.
- Solution cost
Now you have the benefits, let us talk a little about the cost of your solution of choice. If you choose an external provider, there will be some form of license fee, such as a subscription, a license or maintenance costs, which will cover the pure software cost. The latter amounts are very straightforward.
However, it is important to analyze this question a little bit further to assess the total cost of the project and the total cost of ownership.
Will you need technical services from the vendor or a partner? What about the investment of internal people in the project? Will the solution integrate with your legacy systems, or will you have to change something? What is the internal cost of maintenance and administration? And of course, what is the cost of change management?
N.B. Hence, if you decide to invest in a modern collaboration intranet, do not underestimate the change management needed to reap the full benefits from your investment!
- ROI calculation
Once you have evaluated the financial benefits on the one hand and the costs on the other, over a period of time, you can calculate the ROI rate of your solution of choice by dividing the difference between benefits and costs by costs.
If you expected some math or % and $ figures in this post, look for our next post on the ROI subject, where we start exploring the impact of a collaborative intranet on turnover.
What is collaboration?
Collaboration is “the situation of two or more people working together to create or achieve the same thing”.
➝ See the full definition of collaboration
What are the different types of collaboration in business?
Here are some definitions of digital workplace:
- Team collaboration
- Cross-departmental and interdisciplinary collaboration
- Community collaboration
- Strategic partnerships and alliances
- Supply chain collaboration
How to choose the best type of collaboration?
In order to effectively find the right type of collaboration for your business, you have to follow a strategic approach and answer three common yet critical questions: Where are we? Where do we want to be? And how to get there?
➝ Find out How to choose the best type of collaboration
Why collaboration is important?
At the internal level, businesses try to encourage and seek to incorporate different forms of collaboration in the workplace to lay the foundations for teams to be able to work together with an aim to achieve higher levels of success.
Externally, businesses look to engage in collaborative actions to benefit from others’ expertise, to gather the opinions of their customer base and to get customers and other stakeholders more involved in the development of products and services.
What are the benefits of collaboration in the workplace?
Here are some of the benefits of collaboration in the workplace:
- Foster innovation and creativity
- Better problem solving
- Effectively handle times of crises
- Engage and align teams
- Increase motivation
- Attract talents