Cost and re-use of terms: can we measure it? ~ Yes we can!
Naming and defining the concepts of your business is useful. Most BRCommunity members have been term converts for some time. However, it's simply no longer enough to state, "Defining terms is so useful," because the Pavlovian response is (all together now) "How useful is it?" When faced with this question you may find yourself rolling out the soapbox homily — the kind we've all been forced to give now and again when ROI isn't necessarily measured with dollar signs and we hope our passion for the work is enough to sway the skeptics. Try peppering that speech with some casual 'metric-dropping' and transform polite interest into commitment.
When the Rules Management Office (RMO) completed its first business rules project and the terms and business rules were tucked snuggly into our rule repository (RuleXpress) we immediately looked for something to measure. This initial business rules outing produced 54 business rules and 95 terms. Betting that terms would likely see more re-use than rules in upcoming projects, calculating the cost of validation per term seemed a logical place to start. We decided this calculation would be based only on actual hours the business experts (validators) spent validating terms and definitions. (We did not include the Rule Analyst's term development or meeting preparation time.)
26 business experts representing 18 areas of the enterprise attended the term validation sessions. Frankly — it was slow going. We were validating some of those everybody-knows-what-that-means terms. You know the ones: the core business terms that everybody uses but nobody defines in quite the same way. Plus, this was uncharted territory for the RMO, our intrepid Rule Analyst, Colleen, and the business validators. Fortunately, everyone rolled up their sleeves and validated the heck out of those 95 terms.
Here's how we calculated the cost of validation per term:
(number of validation participants x number of validation hours x average hourly rate of the validation participants) / number of new terms validated
For our maiden validation, the cost to validate was $271.00 per term. Huh?! We didn't actually know what to make of that figure. Should we be self-congratulatory or self-flagellatory? What's tough about a lone measurement is that, while very interesting, it's not terribly helpful.
The good news is that when project completions start to multiply so do the number of validated terms and business rules. Suddenly there are myriad ways to measure cost and re-use.
By mining the following 5 gems for each project
- Number of new terms validated
- Number of re-used terms
- Number of validation hours
- Number of validation participants
- Average hourly rate of validation participants
then, oh the things you can calculate!
- Cost of validation per term/per project (calculation from above)
- Total cost of terms validated/per project
- Total cost savings from re-used terms/per project
- Average cost of validation per term for all projects (our average is now $92.00/term)
- Average cost of terms validated per project
- Average cost savings from re-used terms per project
- Cumulative cost of validated terms to date for all projects
- Cumulative cost savings from re-used terms to date for all projects
- Total number of terms used in all projects
- Total number of re-used terms in all projects
And that's not all! How about these bonus calculations?
- Percent of term re-use per project (our lowest re-use = 0%, our highest re-use = 60%)
- Percent of term re-use for all projects (we're at 15% re-use)
- Average number of minutes to validate a term (started at 21 minutes for us, now down to just over 9 minutes)
But wait, there's more! If you've been very good about capturing which projects are using each term (we capture project name as a property for each term — and each term can have multiple project names), that, along with some pivot table shenanigans performed on an Excel spreadsheet exported from your handy rule repository, enables the following discoveries:
- Percent of terms used by only one project, two projects, three projects, etc.
- How many projects have used each term, which leads to
– Top ten re-used terms
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