Equipment Justification: Do A 360˚ Review

9| Reduced head count: Lowering your shop’s head count can have a profound affect on overall cash flow and speed of payback for equipment or technology you’re considering. Note: Be sure to include out-of-pocket benefits and supervision that might also be saved.

10|Improved employee morale and reduced employee attrition: Most organizations require all personnel to be cross-trained. This increases an organization’s capacity, productivity and consistency of quality. Similarly, your skilled personnel represent a form of organizational capital or investment that does not show up on your balance sheet. New technology or equipment tends to improve morale, as new skills are required to be learned and demonstrated. Improved morale tends to reduce employee attrition. Rule of thumb on reducing employee attrition: for each employee not lost, the organization probably saves at least the yearly wages of that employee—generally recognized as the overall cost incurred to replace a valued employee.