Labor efficiency savings
Formula: hours saved per year × fully loaded hourly rate. When modeling a percentage productivity lift across a team, multiply by a separate realization percent so that not-all-time-saved-becomes-cash stays visible.
Close acceleration savings
Formula: hours saved per close × closes per year × fully loaded rate. Cycle-time framing and benchmarks come from APQC.[1]
AP invoice processing savings
Formula: (minutes saved per invoice ÷ 60) × invoices per year × hourly rate. Definition of what to include in invoice processing cost from IOFM.[2]
Headcount avoidance
Formula: avoided hires × fully loaded cost per employee. Only model this when the organization would otherwise hire and the freed capacity is real.
Cash flow acceleration from DSO improvement
Formula: (annual revenue ÷ days in year) × DSO days improved. The result is a one-time cash release — not a recurring annual savings. Definitions and framing from JPMorgan.[3]
Day-count option: the calculator defaults to 365 calendar days for accounting consistency. Set the basis to 260 if your finance team uses working days. Document which choice you made and why.
Vendor spend savings
Formula: annual vendor spend × spend-improvement percent.
Legacy systems retired
Formula: legacy software + server/infrastructure + IT support reductions − new system recurring cost. Represents annual net savings from consolidating systems.
Risk reduction
Tracked as a qualitative score by default. If you convert risk to dollars, use a conservative expected-loss proxy, keep the proxy explicit, and document the rationale.
