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Using the details from the case study complete the following for your report: a. Provide a cost benefit analysis for each option. b. Recommend one
Using the details from the case study complete the following for your report:
a. Provide a cost benefit analysis for each option.
b. Recommend one option and explain why you feel it is the best solution.
c. Provide ROI data for the option you are recommending.
CASE STUDY DATAIN DATAIN is a company that was started by two students who was opportunity to make some money and help pay for their education. As an increasing number of organizations today survey their customers and employees, the two students a need for data input and analyses. With a loan from their parents, they rented space, purchased 20 used com puters, and set up shop. They hired ocher students to do data input and analyses and began advertising their services Within a relatively short period of time they were having trouble keeping up with demand. In fact, business was so good they had to hire more students and purchase more computers After about six months, however, they began to notice some problems. The data files were often full of mistakes, and the data analysis was often incomplete and incorrect. As a result, almost 40 percent (20 jobs per month) of all jobs had to be completely redone. This turned out to be a rather costly problem. Each jo took approximately 10 hours and cost the company 5150 students were paid 515 per hour),| To make matters worse, they began to notice that their new hires were quitting after only a few months on the job. In the last six months, they had lost an average of four employees a month. Every time an employee quit, they had to replace him her and the cost of this was beginning to get very expensive. The cost of advertising interviewing, and hiring a new employee was estimated to be about 55.000 In order to cut down on these anticipated costs, DATAIN decided to invest in a training program to reduce the mistakes and emosin data input and analyses and to improve employee retention. They contacted a training co m e to conduct a needs analysis, design and deliver a training program, and conduct the training evaluation Based on the figures provided by the consultant, DATAIN thought it would be a good idea to determine whether the pro b eer investment. The cos t estimated that the needs analysis and training would cach take about 20 hours at a cost of $100 per hour. The fee to purchase the actual training program would be 55,000. The training programit would be for one day hours) at a cost of $200 per hour to the consultant In addition to the consultant fees., DATAIN would also have to 25 employees one full day (hou) of pay $15 per hour lunch that would cost SIO per comployee and coffee and snacks at a cost of $50 for the day. The training would take place at DATAIN so the only cost for dassroom space would be a por tion of the cost asociated with room heating, lighting and maintenance, which was estimated to be $100 for the day. As well, some administrative support work would be required to plan and prepare for the training which would involve about two days ( hours per day) of work on the part of DATAIN's administrative assistant, who is paid sis an hour. According to the training consultant, DATAIN couldnticipate an Open drop in mistakes and errors and a 90 percent reduction in turnover. In other words, instead of 20 jobs a month only four would have to be redone, and instead of four quits a month there would be on average fewer than one. This sounded like a great investment, however, DATAIN was concerned about the loss of a full day of work while employees attended the program. So they decided to get an estimate from a vender that specialized in leaming training programs. The clearing vendor told DATAIN that she could design a deaming po gram for $25,000. The program would take for hours to complete and would include interactive and opportunities for practice. Employees would be able to take the come on their own time and at their own pace. The anticipated benefits are a 90 percent reduction in mistakes and errors and a percent medias tion in mover DATAIN does not know how to calculate the potential benefits of the two training programs. As a result, they do not know which program to purchaseStep by Step Solution
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