Lab-Life Lessons
Solving problems since 1993.
"Analytical Solutions to Analytical Problems"

A Newsletter from ACCTA, Inc.
Volume 2, No.1 January, 2013
This Month's News and Ideas

Lab Life Lesson #6: Why Is Training a Good Investment and Not an Expense?

The Situation
I recently visited a contract laboratory that performed analytical testing of pharmaceutical products.  The visit was part of a laboratory upgrade of their chromatography software, including moving to a client-server configuration for their 10 HPLC's and three GC's rather than workstations, and receiving training on the capabilities of their chromatography data system software.

This lab's typical workflow required three different people to run the samples, review/process the chromatographic information, and calculate the results.  All results were being manually entered into Excel for calculations, and they were using older chromatography software that did not allow efficient processing of injections.

Can We Improve This Situation?
Clearly, this lab was successful but did not make efficient use of their resources.  Their staff were spending too much time on poorly designed processes, and the ability to increase capacity was limited.  Although the project is not finished, I estimate that with better software training and an improved workflow, I can reduce their data processing and reporting time by at least 50%, from about about two hours to an hour or less for each data set.  In other words, I can save one hour of staff time for each data set.

How Much Will It "Cost?"
This entire project will probably cost the company about $100,000.  Most labs would look at that cost and just reject the idea immediately.  "We can't spend that much money" would be a typical response. Let's look at this situation in a little more detail, and see why this company made the right decision.

Cost and Benefits
Let's assume that we can save each staff member one hour a day in reduced processing time.  (I believe the time savings are actually larger than this estimate, but I want to be conservative about the numbers.)  That hour of time typically costs an organization about $50.  Over one year, that one hour a day totals to 250 hours, or a total cost of $12,500.  If there are 10 staff members involved in these activities, the total is now $125,000 across the laboratory for one year.  These are costs that the organization can now recover in increased productivity, increased capacity, and reduced lab stress.

Calculate the ROI
Return on Investment (ROI) is defined as:

ROI = 100 * (Benefit - Cost) / Cost

An ROI greater than 20% is usually consider a good investment.

For our example, the ROI is:

ROI = 100 * (125,000 - 100,000) / 100,000 = 25%

So, using a series of conservative estimates, we still estimate a very favorable ROI for this project.  Now this is no longer just an "expense" but rather an "investment" in the future.  Remember that the ROI calculation only covers the first year, but the improvements last forever.!

What Does This Mean for Your Lab?
Maybe your lab isn't this large, and cannot spend this much money.  No problem.  You may have smaller processes that are still not as efficient as they could be.  With a small investment, you can make improvements in those processes, and your lab will benefit in the future.

Don't be afraid to look for ways to improve.  Calculate your ROI to evaluate your ideas, and then decide which ones are the best decision for your lab.  If you have problems with the estimates or calculations, we can help.  Just ask.
Investing to Save
We are pleased to report that the article "Investing to Save" by Dr. Merlin Bicking has been published in the December issue of Lab Manager Magazine.

This article discusses how laboratories can properly calculate the benefits of an investment in process improvements, technology changes, and even training.  By learning to calculate Return on Investment (ROI), laboratory staff have more tools to sell their proposals to management.

The article is available on-line.  Click here to view.

Would You Like to Learn More?
We would be happy to discuss this specific issue in more detail, but let's make it part of an overall discussion of how we can help you reduce the stress on your lab and lab staff.  Click here to contact us.

Expense Saving Solutions from ACCTA, Inc.
With three decades of experience teaching labs about how to get the most from their chromatography systems, we are confident that we can make improvements to your methods and procedures, and save your laboratory both time and money.  Click here for more details.
Regards,
Merlin K. L. Bicking, Ph.D.
ACCTA, Inc.
IN THIS ISSUE
Training Is An Investment
Article: Investing to Save
Help For Your Expense Problems
Upcoming Training Events
Webinar: Making HILIC Work For You
January 21, 2013
Webinar: Best Practices in HPLC
January 21. 2013
Classroom/Lab: Infinity HPLC Maintenance and Troubleshooting
February 20 - 21, 2013
Classroom/Lab: Introduction to LC and LC ChemStation
April 9 - 12, 2013
Classroom/Lab: Infinity Series HPLC ChemStation Operation
April 23 - 26 1, 2013
QUICK LINKS
About Our Company
Join Our mailing list
Newsletter Archive
Our Services
Get a Free CBA
Concerned about the cost and benefits of the investments that we describe? Contact us for a personalized Cost-Benefit Analysis (CBA) that will show your management what a good investment this can be.  Contact Robert Zarracina for details.
CONTACT DETAILS
ACCTA, Inc.
Phone: (651) 731-3670

info@accta.com
www.accta.com

Share this