Welcome back to our brief series on calculating the ROI of your UX work. In the previous parts of this series, you can find them under the UX Daily tab on our website, we’ve looked at methods of reporting increased profitability – today we’re going to look at a cost reduction measure.
Support Costs Per User (SCPU)
Every single product sold in the world requires support at some point or another. Even spoons are occasionally shipped without defects being noticed and most products are rather more complex than spoons.
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If you are going to examine the use of cost cutting metrics it is important to remember that your business remains user experience. I could cut the number of helpdesk calls at most software companies to zero; simply by unplugging them from the communications grid. Those companies are unlikely to thank me for this when all their customers go elsewhere. Cost savings are good as long as they don’t damage customer retention, customer spend or customer loyalty.
Calculating the (SCPU)
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Thankfully, as with all of our key metrics this isn’t difficult to calculate. It’s simply the total support costs (both direct and indirect) divide by the total number of users. Direct costs are things like customer care wages, shipping costs for replacements, etc. and indirect costs are the less obvious share of the pie such as the office costs, utility costs, etc. that the customer care department is responsible for.
E.g. Total Support Costs/Total Users = SCPU
Using SCPU in
Keep a careful eye on the total number of users when you use SCPU for ROI calculations; if the number goes up or stays the same – the metric should be a good indicator as to whether you’ve achieved your objectives. If the number of users suddenly drops dramatically; this should be a major warning sign that things haven’t gone as expected.
So let’s look at an example, your SCPU at the beginning of a project is $2 per month per customer and you have 10,000 customers. You spend $20,000 on your improvement project. Following the project SCPU drops to $1 per month per customer and you still have 10,000 customers.
That’s a saving of $10,000 a month ($2-$1 x 10,000) and your project should pay for itself in 2 month and produce a net return of $10,000 a month for every month you sustain that SCPU afterwards.
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Once again, as with all ROI calculations in this series this is somewhat over-simplified and you should take a look at the last parts of the series (published Monday and Tuesday) before you implement SCPU as a metric.
See you tomorrow when we look at our final common metric; Process Performance.