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Follow on Google News | Are Digital Asset Management Systems Worth It?A DAM system can have additional upfront expenses including costs for storage servers, staff training, and IT support. But for organizations that create, manage, deliver, and archive thousands of digital assets every year, the ROI can be significant.
By: IO Integration Some companies look at DAM as an externally billable service, or provide it at no charge to entice customer loyalty. Many businesses find that once they have a customer using their DAM solution, it will become part of that customer’s internal workflow, and subsequently makes it much more difficult for those customers to disengage. Be sure to include any sales or new business development employees in the DAM solution. Those employees are often looking for new things to show to existing customers in the drive for new revenues. Many diverse factors are considered when determining ROI. Two of the most common approaches with ROI consider either many smaller, short term gains, or one larger, long term gain. Initially, most companies opt for the short term approach. By measuring many small advances or savings in labor or materials, and then extrapolating those numbers across multiple employees, and departments, and companies, a small handful of modest examples can quickly add up to the numbers required to justify the cost of a DAM system (http://www.iointegration.com/ With many ROI scenarios, if one doesn’t bear out in the final tally, others are still able to prove the point. Smaller examples also mean easier and quicker measurement of the investment’s performance. For example, if a company does in-house production, a DAM system is a tremendous benefit. Most production departments use a rough calculation where employees should bill 300% of total employee cost (salary plus benefits.) So if an employee costs the company $100,000 per year, the production team may target a $300,000 average billing per resource. Given a 240 work day year, that breaks down into $1250 per day or a $150 per hour billable target. Using a very conservative example, with a production team of 5 people, saving each of them ½ hour per day equals $90,000 per year (5 people x (.5 x hourly rate of $150) x 240 days per year). Often production employees spend at least 30 minutes per day just searching for assets. Most production managers look at the non billable costs for the return on investment (ROI,) and show this savings as additional income possible with the same staff, versus justification for employee reduction. To put it another way, that $90,000 in labor currently is typically unbillable, and that labor could instead be used for billable work. That shows new income without a related increase in labor making the department more profitable. The scope of the project can be a double edged sword. Keeping the scope small affords lower overhead cost, but at a proportional increase to the burden of proof to that smaller group. A larger scope diversifies and insulates the risk, but the overhead in documenting a larger set of requirements will add to the DAM solution timetable. Regardless of whether the ROI will be proven in the short term or longer term, plan for flexibility and modifications down the road. Many DAM customers repeatedly demonstrate how the single investment continues to pay dividends well after the ROI has been proven. Once the base solution is installed, a minor reinvestment in a DAM solution can have large rewards. Additional clients, business units or company initiatives are often introduced to existing DAM ecosystems with minimal or fractional additional costs. Long term flexibility should be a cornerstone of any DAM solution. This technology in particular touches many different areas of the company, and allowing the DAM to either feed or pull from other business processes is essential. To this end, workflows should be designed to be easily modified as business requirements change. Adobe’s eXtensible Metadata Platform (XMP) is a good technology to keep in mind for this purpose. XMP is a labeling technology that allows you to embed data about a file, known as metadata, into the file itself. The immediate benefit of this is that your digital asset management system (http://www.iointegration.com/ Validation of ROI is often overlooked or undervalued. Be aggressive and optimistic, but with a small readily identifiable example. An eighteen month target for the ROI is usually quite achievable, but often the ROI is realized much quicker, sometimes within a few months. Document the initial requirements, the final agreed to set of scope objectives, and what the actual results were. Rarely does the finished solution exactly match the initial objectives, but often additional sources of ROI are discovered along the way. This helps solidify the original arguments and helps bolster the validation of the ROI. DAM solutions are not impulse purchases. They require collecting all business requirements, thoughtful consideration of sometimes opposing viewpoints, a commitment to driving the process to completion and proving that the project was an unqualified success. Your DAM vendor should have practical experience in how these solutions are presented, deployed, and managed long term. By understanding the company’s fiduciary responsibility, and how the company generates revenue, a DAM solution can provide a tremendous cost savings and a source of revenue for many years. About IO Integration IO Integration is one of the leading system integrators in the United States, specializing in the North Plains Xinet (http://www.iointegration.com/ End
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