A useful proposal starts with what must work.
Without knowing which systems connect, which data is used and who approves the output, a general price does not describe your project. Ask for written scope: inputs, outputs, volume, exceptions, acceptance criteria and handover.
Separate the cost of establishing feasibility from introducing and maintaining the solution. Check what happens if the pilot fails its criteria: what you receive, which activities stop and which costs continue.
What to include in the total cost.
| Cost item | What to check |
|---|---|
| Assessment and data | Process mapping, examples, data cleanup, permissions and test preparation. |
| Implementation | Configuration, integrations, review interface, controls and tests. |
| Introduction and internal work | Owner time, training, documentation and parallel running during transition. |
| Licences and usage | Software plans, model calls, storage, retrieval and infrastructure. |
| Review and errors | Human checking, exceptions, rework and the consequences of errors. |
| Ongoing operations | Monitoring, support, tool and model updates, and repeated evaluation. |
| Exit | Data and configuration export, access removal, restoration or migration. |
Measure time first; then assign a value.
Net hours recovered each month = cases handled × (minutes before − review minutes after − average correction minutes per case) ÷ 60. Count only cases actually covered. If average review time already includes corrections, do not subtract them again.
Value of recovered capacity = net hours × fully loaded hourly cost. Net monthly benefit = capacity value − additional recurring costs. If monitoring labour is included in recurring costs, do not also subtract the same hours from recovered time.
Capacity value is not automatically cash saved. Specify its use: absorbing more work, reducing overtime, avoiding planned expenditure or improving service. Model possible additional revenue separately, with explicit assumptions.
A full example, using invented inputs.
| Assumption or result | Monthly calculation |
|---|---|
| Volume and coverage | 1,000 cases × 80% covered = 800 cases; the remaining 200 use the current method. |
| Time before and review after | 8 minutes before; 3 minutes to review each draft after. |
| Additional corrections | 10% of 800 cases × 5 minutes = 400 minutes. |
| Net hours recovered | (800 × (8 − 3) − 400) ÷ 60 = 60 hours. |
| Capacity value | 60 hours × €30 fully loaded hourly cost = €1,800. |
| Additional recurring costs | €100 licences + €80 usage and infrastructure + €120 monitoring = €300. |
| Estimated net monthly benefit | €1,800 − €300 = €1,500 of capacity value after costs. |
| Hypothetical initial investment | €6,000 implementation + €1,000 internal work and introduction = €7,000. |
| Investment recovery | €7,000 ÷ €1,500 ≈ 4.7 months at steady state, if all assumptions hold. |
All inputs are arbitrary and illustrate the method only. This simplified model excludes taxes, cost of capital, introduction delays and consequential error losses; add them where relevant. It is not a price, savings or financial-return promise.
Change the assumptions before trusting the answer.
In the same example, increasing review from 3 to 5 minutes reduces net recovered time to roughly 33.3 hours. Capacity value becomes €1,000 and net benefit €700: investment recovery takes 10 months at steady state. Two extra minutes change the decision.
Build a conservative scenario with fewer covered cases, more review and higher usage cost. If net benefit is zero or negative, the model has no finite payback period. Before expanding, replace assumptions with pilot measurements.
Five questions before approving the project.
- Which costs are included, variable or dependent on third-party providers?
- Who measures review and errors, and on which sample?
- What must our team provide, and who will be involved?
- Which activities and costs remain after handover?
- What justifies moving from pilot to operations, and what happens if we miss the criteria?
A template to work from.
Project cost and return worksheet
An editable Markdown worksheet with formulas, full costs and scenarios for your own inputs.
Download the Markdown templatePractical questions
Can you give a standard price for an AI project?
Not credibly without scope and integrations. An initial conversation identifies the work and constraints; a proposal should then separate one-time work, recurring expenses and variable usage.
How do I calculate twelve-month ROI?
In a simplified model: (net monthly benefit × actual months of use − initial investment) ÷ initial investment. Use realistic months and include volume changes, maintenance and introduction costs. If the benefit is recovered capacity, describe it as estimated ROI on capacity value, not a cash return.
Which costs are easiest to overlook?
Explicitly check internal work: preparing examples, reviewing outputs, handling exceptions and maintaining the system. It is not necessarily the largest cost, but it needs to be measured.