Value of Documentation (was <No subject given>)

Subject: Value of Documentation (was <No subject given>)
From: "Engstrom, Douglas D." <EngstromDD -at- PHIBRED -dot- COM>
Date: Wed, 30 Apr 1997 08:08:55 -0500

This is written in reply to Eric J. Ray's comments on how to estimate
the value of documentation:

However, the real crux is that the value of technical communication
depends almost completely on the company and in a variety
of ways...

<good stuff snipped for brevity>

...What you need to do is find companies with a focus on quality
(there's one of those fuzzy words again) and a real interest
in providing the best possible product or service, as well as a
substantial budget for soft expenses. Then, you'll have something.
I think Eric is right on the mark with the idea that the value of
documentation varies a great deal from company to company, and even
transaction to transaction. I worked at one company where, from the
business standpoint, the value of good documentation was negative.
They had educated/manipulated/persuaded their customers that the way to
handle their products was to have a field engineer fly out to the
customer site and, for a substantial fee, do what had to be done. Good
documentation that made the customer more independent just reduced
product mystique and cut into engineering service fees. One of these
days, the competitive situation will require a change in strategy, but
that day is a long way off. (For obvious reasons, I only lasted about 18
months there.)

And on another, somewhat-related point....

At 09:38 AM 4/29/97 -0300, Jonathan Leer wrote:
>You're absolutely right. There are no established guidelines. But why
>not try? You can't tell me that accounting doesn't put a value on
>everything, including goodwill. EVERYONE HAS A VALUE, whether it is a
>expense, revenue, or asset.
Brief point--"goodwill" in the accounting sense is not the warm and
fuzzy feeling people have for each other or your business. Rather, it's
an accounting abstraction that accounts for the difference between the
acquisition cost of an asset (dollars paid for it) and its book value
(acquisition cost plus additional investments, less depreciation).
Usually, this reflects the difference between a bunch of assets sitting
around, and the intangible value of an ongoing business.

For example, suppose you buy a furniture store whose inventory and
miscellaneous assets were acquired by the previous owner for $100,000
(we'll assume all purchases are recent, so we won't worry about
depreciation or additional investments). He or she presumably will
*not* sell you that business for $100,000, but will expect "something
more" for the fact that it's a going concern. If you purchase the
furniture store for $150,000, the $100,000 in "hard" assets show up on
your balance sheet in the appropriate categories. The "extra" $50,000
that you paid also shows up on your balance sheet--as an asset called
"goodwill". (I think it used to be called "goodwill and future profits"
which makes more sense.) Like all other assets, it can be depreciated
over time.

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