|Unintentional Cost Transfer
A serious risk in many attempts to cut costs is unintentional cost transfer. An operating area within a company cuts its costs by taking an action that creates costs in another operating area. For example, costs cut in manufacturing may increase costs in customer service.
The result for the company may be a much smaller cost reduction, no cost reduction, or a cost increase. Because the cost transfer is uncontrolled, the result may be far worse than the original problem. Sales may plummet; support costs may explode.
Our four-page article Winning the Financial Whac-a-Mole Game examines problems caused by unintentional cost transfer and suggests ways to cut costs effectively.
Knowledge problems are the source of many costs. Customers need knowledge to set up products, use them efficiently, and take full advantage of their capabilities. Developing, marketing, and supporting products also require knowledge.
To design products, developers need information about users' needs. Sales people must have the information necessary to close sales without wasting resources. Support people need information to solve problems quickly and efficiently.
Knowledge problems are costly: developers who lack knowledge of users' needs will design products nobody wants to buy. Sales people who lack the knowledge they need to sell efficiently will lose customers. Customers who lack the knowledge they need to set up and use products will overload the technical support staff or return the products. Support people who cannot solve problems quickly and efficiently will send support costs skyrocketing. The list goes on and on.
The solution to problems caused by lack of knowledge is to quantify the cost of the problem, identify the knowledge required to solve the problem, and provide the knowledge in a cost-effective way. Technical communications are a great way to cut costs by solving knowledge problems.
Reduce the Cost of Training and Product Support
Technical communications usually have a direct impact on the cost of training and product support. The communications can help the training staff by teaching concepts and tasks that are difficult to understand. The communications also can help the support staff by explaining topics that have been generating a high call volume or taking extra time to resolve.
When the ultimate solution involves changes to the product, technical communications can provide an interim solution. If a product has an awkward user interface, for example, the ultimate solution is an intuitive user interface. But sales may be lost while the user interface is redesigned. A technical communication that explains how to use the product compensates for the awkward user interface and gives the product team time for a high-quality redesign.
Reduce the Cost of the Sales Process
Educating prospects about technical products and services is often labor-intensive. Replacing time spent by sales representatives and members of the development staff with technical communications cuts the cost of prospect education during the sales process.
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