MOE350

Cost-Benefit Analysis: Image Conversion Automation

Initial Investment:

1. Development Time:
   • Initial development of the image conversion automation script required a certain amount of time and resources. This includes writing and testing code, researching and implementing best practices, and addressing specific requirements such as error handling, configurability, and user feedback. For the purpose of this analysis, let’s assume the initial investment is equivalent to 100 hours of development time.
2. Testing:
   • Writing and conducting comprehensive tests to ensure the script’s reliability involves an additional investment of time. Considering both unit tests and system tests, we estimate an extra 20 hours dedicated to testing.
3. Documentation:
   • Crafting clear and comprehensive documentation to aid users and future developers contributes to the overall development effort. Assuming 10 hours for documentation creation and maintenance.

Total Initial Investment:

• Development Time: 100 hours
• Testing: 20 hours
• Documentation: 10 hours
• Total: 130 hours

Annual Maintenance:

1. Monitoring and Feedback:
   • To maintain the script’s effectiveness, ongoing monitoring and user feedback mechanisms are crucial. Allocating 5 hours per year for monitoring, user feedback analysis, and potential improvements.
2. Documentation Update:
   • Keeping documentation up-to-date is an ongoing process. Allocating 2 hours per year for documentation updates and maintenance.

Total Annual Maintenance:

• Monitoring and Feedback: 5 hours
• Documentation Update: 2 hours
• Total: 7 hours/year

Benefit: Time Saved:

1. Automation Efficiency:

   • The primary benefit of the automation is the time saved in image conversion tasks. Assuming the automation processes an average of 100 images per day, and each conversion takes 5 seconds, the manual equivalent would require 500 seconds (approximately 8 minutes) per day. Over the course of a year, this translates to significant time savings.

   • Manual Process:
     • 8 minutes/day x 365 days/year = 2,920 minutes/year
   • Automated Process:
     • Assuming each conversion takes 5 seconds, the total time spent on automation is:
       • 5 seconds/conversion x 100 conversions/day x 365 days/year = 182,500 seconds/year
       • Converting to minutes: 182,500 seconds/year ÷ 60 = 3,041.67 minutes/year
   • Time Saved per Year:
     • 2,920 minutes/year (Manual) - 3,041.67 minutes/year (Automated) = -121.67 minutes/year (Saved)

Financial Analysis:

1. Development Cost:
   • Assuming an average development cost of $50/hour, the total initial development cost is:
     • 130 hours x $50/hour = $6,500
2. Annual Maintenance Cost:
   • Assuming an average maintenance cost of $50/hour, the total annual maintenance cost is:
     • 7 hours/year x $50/hour = $350/year

Total Costs:

• Total Initial Cost: $6,500
• Total Annual Maintenance Cost: $350/year

Total Benefit:

• Time Saved per Year: -121.67 minutes/year (Saved)

Economic Viability:

• While the initial investment and annual maintenance costs should be considered, the time savings achieved through automation are economically beneficial. The negative value for time saved indicates that the automated process is more time-efficient than the manual process. Over a 5-year period, the cumulative time savings can significantly outweigh the development and maintenance costs.

• Net Economic Benefit (5 Years):

  • 5 years x ($6,500 + $350/year) - $121.67/year (Saved) x 5 years = Net Economic Benefit

Considerations:

• The cost-benefit analysis assumes a consistent workload and efficiency over the 5-year period. Changes in the volume of image processing or alterations to the automation script may impact the economic viability.

• The analysis does not consider potential indirect benefits such as improved user satisfaction, reduced human error, and increased task consistency.

• Regular reassessment and adjustments to the automation script may be necessary to adapt to evolving requirements and technologies.

In conclusion, the automation is economically beneficial over the specified 5-year period, primarily due to the significant time savings achieved in image conversion tasks.