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The
Business Case for XML
Don
Bridges (pictured below), Account Manager for Technical Documents at
Data Conversion Laboratory, presents a White Paper revealing the many
business advantages of adopting XML
Introduction
In
the last 10-15 years the business world has witnessed a paradigm
shift in the way information is created, managed, and distributed. My
experiences at Pratt & Whitney in the late 1980's were probably
fairly typical for the time. Memos were available in hardcopy,
circulated via a routing slip that listed everybody that needed to
read the memo. Reports were created on an early variant of the PC.
E-mail was an intra-company tool. The fax was a mainstay for
communicating with customers and vendors. Tech manuals were available
in hardcopy only. Periodically I received an update for the copy of
the IPC (Illustrated Parts Catalog) that I had ownership of, and
every Christmas I would dutifully insert the updates (well, at least
it was current for a few weeks).
The world has changed... sort of. While e-mail is
a cornerstone for business communication and the fax is going the way
of the 8-track tape player, tech manuals have been slow to migrate to
a digital paradigm. Every organization, commercial and non-commercial
alike, faces the same competitive pressures that are changing the
face of business worldwide: How to produce a greater variety of
products, continue to improve quality, accelerate time-to-market, and
maintain or reduce costs. Organizations that produce customer and
service information face the same challenges: How can we efficiently,
accurately, and quickly deliver our information on paper, on CD-ROM
and on the World Wide Web? How can we streamline our processes,
improve our authors' productivity, reduce redundant work, and
eliminate tasks that add little or no value? How can we protect our
information from hardware and software obsolescence?
Many organizations understand the need for
"electronic" manuals, but the business model has been slow
to develop. To implement this change, the financial decision makers
want concrete proof that implementing a new system will pay for
itself in short order.
This paper is not your "Business model for
migration to XML in 5 Easy Steps." It is a discussion of how
Data Conversion Laboratory (DCL)
sees the world with regard to typical corporate information (focusing
on technical publications). It is a discussion of the business issues
that go into a business model, including how to tell if your business
situation is "ripe" for an XML system, or still "green."
It is practical answers to some of the typical objections that we
hear. In short, it is a stop along the way to understanding (really
understanding) if XML is the answer for your business needs and,
if so, some ammunition to help you win the war.
Existing Information Processes
For most organizations, the "data"
process has two components.
Data Creation: Content experts create
technical information. They take their direction from Engineering or
their own efforts and put into words (or pictures) the processes and
information needed to maintain a piece of equipment.
Print Publishing: These are the people
that take the data and massage it for print publishing. They are
responsible for a corporate "look and feel" and that the
information on the printed page is clear, concise, and visually
appealing. In many cases this job is done by the content experts
concurrent with the data creation stage.
Before the Web, the process of capturing
information from your experts and distributing it to your customers
in print was relatively straightforward. Experts used a variety of
tools, often word processors, to create their information. A
technical publishing group converted that content for their desktop
publishing software. And then combined content from multiple experts,
cleaned up the wording, created transitions, and made the formatting
and structure consistent.
While this process posed a challenge for
maintaining information - due to the effort required to capture
changes and track down the location of the information needing to be
changed - it was a challenge that most organizations were able to
manage.
Impact of the Web
With the advent of the Web, the process became
more complex. Because the Web is not just a new way to deliver print
information, but a new way to present and interact with
information, organizations find themselves creating new groups whose
function is to make significant changes to the information in order
to effectively present it on the Web. They break up documents into
smaller chunks, add linking, and other interactive elements.
The web adds the following functional groups to
the list:
Data Creation
Print Publishing
Electronic Publishing
When the time comes to change information, the
process of tracking down everything that needs to change for both the
print and Web forms has become hugely challenging. Despite the
tremendous effort, inconsistencies and inaccuracies still creep in,
leading to customer frustration and increased business risk.
The reality in most organizations is that there
are many separate groups - perhaps dozens and in some cases hundreds
- who participate in the information chain. Fragmented repositories
and source formats create huge inconsistencies, long delays in
updating, and tremendous barriers to reuse and updating. The costs to
the organization are enormous.
Single Source
To address these problems, the concept of "single
source" has been promoted, where all redundancy is eliminated,
both at the information level and at the process level. This approach
enables 1-click changes, so that information can be changed once and
automatically updated wherever and in whatever forms it appears. You
can:
Capture all product information (both
pre-sale and post-sale info)
Store data in a single source in
media-neutral format. This is managed by a Content Management System
(CMS) and is the "single source of truth" for
optimal quality.
Automate delivery to Web, print, PDF, CD-ROM,
and other media by extracting the information, applying the
appropriate formats for the desired medium, and outputting to that
medium.
XML (and its predecessor SGML) was developed as an
answer to the desire for a single source format. XML represents any
type of information in a media-neutral format. This enables
automation, which speeds delivery, permits enhanced functionality,
and reduces costs.
XML has the additional virtue of being a standard
without competition; virtually every software company has embraced
XML and many major software companies are investing heavily in
adapting their products to use or support XML. (There's a big
difference between "use" and "support," but both
deliver benefits to the customer).
Business Benefits
Today's bottom-line business impact of adopting
XML technologies is especially important. For any company that shares
information with its customers as a critical part of the value chain
it delivers, the creation of a single source of information from
which you can deliver to all current and future media will deliver
real, sustainable competitive advantage.
The benefits can be generalized into two areas:
Increasing revenue
Decreasing costs
1. Increasing Revenue
XML authoring systems can increase a company's
revenues in multiple ways:
Customer satisfaction and retention.
Customer retention is a competitive advantage that can be
improved by offering more services to a customer. In the
documentation world, this means personalized content. Product
instructions, guides, and repair information that are product
specific have more value to a customer. In general, it is very
difficult to estimate the impact of increased customer satisfaction
on revenue. However, the costs of losing a customer are clear:
acquiring a new customer costs six times as much as retaining an
existing one.
Products to market faster. Most
products must be delivered with some kind of documentation. If the
documentation (for example vehicle owner guides) is not yet
finished, it may delay product launch. An earlier product launch, on
the other hand, will increase revenues. While this increase is
quantifiable, it is not clear how large a role the documentation
plays. Just because the instructions can be completed faster doesn't
mean that the product is ready to roll out the door.
Expansion into new markets. To enter
new markets, product information and documentation must be
translated into new languages. A properly structured XML authoring
system will decrease translation costs which, in turn, will reduce
the cost of market entry. A company's cost accountant or export
product manager should have access to market entry costs figures and
the resulting increased revenue. Decreased translation costs may
make it more enticing for a company to enter a new market.
Some of these benefits are difficult to quantify.
Top management is usually skeptical about claims of improved revenues
or reduced costs unless they're based on numbers that are almost
incontrovertibly true. However, you may be able to calculate
improvements if you know enough about your processes:
Faster time to market –
where are the bottlenecks? How much of your development cycle
depends on information creation and sharing? How much information
can you reuse instead of creating from scratch?
Increased customer loyalty –
do you measure customer satisfaction? Do you measure customer
attrition? How are the two related? How much can you improve
satisfaction and reduce attrition?
Market expansion –
related to the first one (new products) as well as to translation
(new geographies) – does the cost of translation keep you out
of markets?
Greater agility – related
to all of the above: How long does it take you to respond to
competitive threats?
Customer self-service –
how many pre-sales and post-sales calls do you get that are not
adequately addressed in your published information but are
available within your organization? What percentage of your total
calls do these calls represent?
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Certainly the
implementation of an XML-based system will have ripple effects far
beyond the "Tech Pubs" group. It is our experience that
most organizations have the following department goals in reaching a
corporate goal:
2. Decreasing Costs
An XML authoring system not only offers increased
revenue opportunities, it also produces significant cost savings in
several areas:
Increasing authoring productivity. In
traditional desktop publishing systems, an author spends 20-50% of
their time laying out pages. XML authoring systems provide automated
page layout. The author can now concentrate on being a subject
matter expert and give up the tedious task of choosing fonts, font
sizes, indentions, etc.
Reducing publishing effort. As a
structured mark-up language, XML supports automated processes,
including publishing. Once the XML documents have been authored,
automated publishing processes take over to generate print, CD ROM,
Internet, PDA and mobile phone output.
Increasing information reuse. An XML
authoring system with a Content Management System (CMS) provides the
ability to store and reuse information objects that are smaller than
a typical document. (The choice of chunk size or granularity is an
important decision, but is outside the scope of this paper). Each
object gets stored together with metadata that defines the range of
products for which an object is valid.
Metadata includes
descriptors such as product model name/number, build date ranges, and
other attributes which describe the product. For automotive
documentation, metadata typically includes model, model year (or VIN
number range), engine type, transmission type, body style,
right-hand-drive or left-hand-drive, etc.
A major goal of the
CMS is to make it easier for an author to find and reuse an existing
information object than to create a new one. Using a CMS, information
reuse can be increased by 30-60%.
There are three ways
to reduce the amount of new/changed text: (1) Using a glossary and/or
controlled vocabulary; (2) Information object reuse via the XML
authoring system; (3) Using a translation memory system to find
matching sentence pairs below the object level.
Manual page layout of
each translated language may account for a significant amount of the
total translation costs. For example, with only 5 languages, language
layout may account for up to 40% of the total translation bill. Since
layout is automated in XML, these costs can be totally eliminated.
Future-proofing data. Companies that
have moved their data from WordPerfect to Word, then to a desktop
publishing format, and then to the next file format, etc., know the
costs of data conversion. Since XML is a non-proprietary and
standards-based markup language, native XML data is operating system
and software product independent.
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Projectable Time Savings
If the effort of producing documents is divided
into four discrete steps (Creation, Review, Translation, and
Distribution), we can graphically represent typical results of
implementing a Single Source system as follows:
After we have informed ourselves about the
technology and the products and convinced ourselves of its value to
our business, we still need to convince senior management to invest
budget dollars in our project.
Developing the system vision and goals
The vision and goals for the XML authoring system
should be developed early on and should include quantifiable
objectives.
Here is an example of project goals that are
difficult to add metrics to:
The goals of the ACME-Authoring System are to:
Compare the above to quantifiable goals:
The new ACME-Authoring System will:
Reduce authoring costs by 30%.
Reduce translation costs by 40%.
Improve quality and consistency of our
documentation.
These are both real-life examples of goal
statements. If you were a senior manager, which one would you prefer?
There are a couple of Microsoft Excel models that
you can customize to your environment.
This Excel file (or
web-based) file allows you to project cost savings from implementing
a XML based single-source solution.
This Excel file lets you
enter parameters for your authoring system (number of authors, number
of pages per year, etc.) to calculate the break-even point. Start
with worksheet "Input Data" and replace the typical
(industry average) data in the yellow cells with your own data. Work
through each sheet from left to right, following the instructions at
the top of each sheet.
The Air Transport Association TICC Executive Committee has designed a cost savings analysis tool to estimate the potential annual cost savings that could be realized when using digital data technology (such as XML). This tool is not exact. It is intended to give you a sense of the magnitude of the savings that may be realized. Individual results will vary. All responses will be treated as Confidential.
Estimating increased revenue
Of the three ways in which an XML authoring system
can increase revenues - customer satisfaction, products to market
faster, and new markets - the latter is the easiest to quantify. If
your company is planning on entering new markets in the near-term,
you should definitely include the reduced translation costs that will
result from the new XML authoring system.
System rollout and timing - or - How quickly can
savings be realized?
It typically takes 24 months for a new XML
authoring system to be developed and implemented. But by using a
phased delivery project management methodology, we can deliver parts
of the system to the users earlier. After an elapsed project time of
12 months, authors should be able to start working in XML and thus
start accruing savings. Please contact
me if you would like more information on a phased roll out.
Return-on-Investment (ROI)
Return-on-Investment (ROI) is a financial
investment analysis tool that is used to compare potential projects.
A full ROI analysis must include the company's cost of capital, the
corporate tax rate, investment tax credits, depreciation, cash flow
and the time-value of money (net present value). The description of a
compete ROI calculation is beyond the scope of this paper.
An ROI Calculator at
http://www.vftis.com/presentations/SPX_Valley_Forge_roi_calc.xls
is available from SPX Valley Forge. This Excel file lets you enter
financial parameters for any capital investment project and then
calculate the Net Present Value (NPV), Internal Rate of Return (IRR),
and Return on Investment (ROI) of the project. You may want to have
some accounting types to help you enter the data.
Upgrading to a next-generation XML authoring
system
For companies that are already using XML authoring
and are planning to upgrade to a next-generation system, developing
the business case may be more difficult. Essentially, your
first-generation XML authoring system should have already given you
the "easy wins" from automated layout and publishing in
both the original language and the translations. However, you may
still have inefficiencies in the system, areas that could still be
automated, and you can always increase the reuse amount. The basic
procedure of analyzing your current costs and estimating future
savings remains the same. Unfortunately, your cost analysis may now
be twice as big. To do the job right, you should compare your costs
during the pre-XML time to your current costs as well as comparing to
your estimated future costs. After you had moved to XML, did you gain
all of the efficiencies expected? What are your main cost drivers
today? These are the types of questions you will need to examine.
Conclusion
XML authoring makes good business sense, even if
the economy is slowing down. However, to get a new XML authoring
system approved, we need to present the project to senior management
in terms that they understand: quantifiable goals, reduced costs,
break-even point, ROI. To get the project approved, you will need to
make the project economics as important as the user functionality and
the technology. Add a company accountant to your team early on to
help with the number crunching. A business case consists of a
comparison between the savings and the project costs. The most
difficult part of the exercise is to gather the current cost data.
Using a spreadsheet program, it is possible to generate the
break-even point of a project.
Don Bridges
Account
Manager for Technical Documents
Data
Conversion Laboratory
Comments &
Correspondence to:
dbridges@dclab.com
Credits:
This paper leaned on information from the
following DCL strategic partners:
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