Cost of Poorly Written Documentation

poorly written documentation cost

The goal of clearly written documentation is to provide information, so employees quickly understand how to do to complete a task. Other ways clear documentation benefits your customers include:

  • Less confusion and fewer complaints
  • Fewer questions and calls (improved customer service and satisfaction)
  • Reduced workload for your department’s staff so they can focus on current projects
  • Saved time and money due to reduced errors and misunderstandings throughout the company
  • Easier staff training
  • Increased productivity throughout the company

Despite these goals and benefits, the total cost of business transaction management results in the large expense of time and money by companies every year due to the loss of employee productivity. How large is this expense? Why does this happen? A likely reason an employee loses productivity is due to poorly written documentation. They try, without success, to understand user written documentation created by departments in their workplace. Because I wanted to find out how much, in terms of time and money, this expense costs a company, I did some research. Here’s what I learned.

Cost of Poorly Written Documentation

The cost of poorly written documentation impacts businesses of various sizes. For instance, an article in Inc. in 2018 cited a Holmes report (now part of provokemedia.com) as placing the total cost of poor communication at $37 billion for 400 surveyed companies with 100,000 or more employees in the United States and in the United Kingdom. Breaking this down further, estimates of the corporations surveyed indicated the cost of lost productivity for the average business was $62.4 million per year. This boils down to $26,041 cumulative cost per worker per year. The cost resulted from employees misunderstanding documents about company policies, business processes, or their job functions; and then having to contact the originators of the documents for help.

Smaller companies are also impacted by poorly written documentation. According to a research study published around the same time as the Inc. article, employees in businesses with 100 spent 17 hours each week getting clarification of the written documentation. The cost for a company of this size averaged $420,000 to more than $500,000 per year.

Frustrated User

Time and Money Lost Due to Poor Documentation

Time spent on fixing the effects of poorly written documentation continues to result in the loss of valuable working time and money, even in 2020. For example, tradingeconomics.com indicates the average hourly rate in May 2020 in the United States as approximately $25 (actual rate = $24.97). Assume an employee, who encounters poor documentation, wastes an average of ten (10) minutes each hour trying to understand a document, then $4.17 per hour per employee in productivity is lost while the employee gets clarification on the document. It is easy to see how the cost of poor documentation increases as the number of employees in a company has increased. It results in hundreds of lost hours of productive work and thousands of dollars in lost revenue.

Let’s expand on this example to determine the time and money a hypothetical company with 100 employees might lose per year. An employee works 40 hours/week for 50 weeks/year, which equals 2,000 hours/year. The employee loses (based on 10 minutes/hour) 20,000 minutes/year, or 333.33 hours/year in productivity getting clarification on instructional/procedural documents. Lost productivity (based on $4.17/hour) times 2,000 hours/year equals $8,340/employee/year. Based on this example which takes place in May 2020, a company with 100 employees could still lose valuable working time (333.33 hours) and significant money ($834,000).

Having a straightforward written documentation process in place can reduce the cost of time and money in lost productivity. The process helps companies and their departments develop a clear communication strategy to improve your department’s approach to writing user documentation.

Source Material

Holmes Report. (2011, July 16). The cost of poor communications. Retrieved from https://www.provokemedia.com

Schneider, Michael. (2018, July 11). Costs of poor communication reach $37 billion. Retrieved from https:// www.inc.com

The effects of poor communication in business. (n.d.). Retrieved from https://smallbusiness.chron.com

The tragic unseen costs of digital miscommunication. (2018, July 6). Retrieved from https://medium.com

United States average hourly wages. Retrieved from https://tradingeconomics.com/united-states/wages

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