Cost of Current State Worksheet
Version 1.0 · Excel workbook · what your current environment costs to run
A modernization business case almost always compares a platform cost to nothing at all. License, implementation, integration, some contingency, set against a savings number the finance function correctly regards as soft. The status quo enters at zero, because nobody ever priced it. This workbook prices it. Six tabs, 266 live formulas, no macros, no protected sheets, nothing computed elsewhere and pasted in as a value.
The one thing it is built to do
Give you a number the platform has to beat.
Four cost lines, separable and separately arguable. Exception labor, the share of operations time absorbed by breaks, rekeying and chasing reference data. Onboarding delay, elapsed weeks per onboarding times how often it happens, counted as effort plus the spread given up while capital waits. Remediation, what bad reference data costs once it has already reached a valuation, a payment or a client report. And the ceiling, positions per FTE as a hard constraint, priced as the hiring growth forces on you.
On the illustrative scenario those four come to $1,840,355 a year. Two point three basis points of assets, fifty two dollars a position. That is the figure a proposal has to clear, and it is the figure almost nobody puts on the page.
What is in it
Your own environment, on the first input tab. Book size and growth, operations headcount and loaded cost, the share of time on exception work, onboarding frequency and elapsed weeks, break volume and leakage rate, severity event frequency and cost. Every blue cell is yours. Everything downstream follows.
A modernization case you enter yourself. Implementation cost, platform cost, implementation elapsed months, and what you expect afterwards for exception work, remediation, onboarding elapsed time and positions per FTE. No vendor is named and no vendor pricing is assumed, because those two numbers are the only ones you actually know.
A five year projection that charges the build. Implementation elapsed time drives the model rather than sitting beside it. Benefits phase in as the new environment goes live, implementation spend is spread across the build rather than landing in year one, and the platform fee is charged from contract rather than from go live, so the build period carries both environments at once.
Two sensitivity grids, both in NPV. The first moves platform cost against residual exception rate. The second attacks the onboarding assumption directly, across the spread given up and the elapsed weeks you expect to achieve afterwards. Both report the same metric as the headline, so the grid and the decision cannot disagree with each other.
A ceiling tab. Positions per FTE year by year, the year-end requirement and the mean requirement side by side, and the avoided hiring the case actually rests on.
What it does not do
It does not model migration risk, parallel running headcount, or the cost of an implementation that fails. It charges the platform fee alongside the old environment during the build, which is the main parallel cost, but the extra people a parallel run usually needs are not in there.
It is five years on one entity. It does not consolidate.
It assumes no headcount reduction. Savings come from avoided hiring only, never from cutting people already in post. If you intend to reduce the team, this understates your case on purpose.
It does not name, rank, price or recommend any platform. It is not a vendor comparison.
It can tell you not to do it
Sixty nine percent of the first sensitivity grid returns a negative answer. Enter a modest book, a small exception queue and a large platform cost, and the workbook reports plainly that your current environment is cheaper and the case does not hold on cost alone.
That is in the model on purpose. A worksheet that can only say yes is a sales sheet, and the whole value of pricing the status quo is that sometimes the status quo wins. Finding that out in a spreadsheet costs an afternoon. Finding it out eighteen months into an implementation costs considerably more.
Verification
Every figure was checked against an independent implementation written in Python from the specification rather than from the workbook formulas. The two share no code. They agree on all four cost lines, every year of the projection, both sensitivity grids cell by cell, and the ceiling staffing. All 266 formulas recalculate without error.
Ten stress cases were run looking for economically nonsensical answers: zero growth, fifty percent growth, thirty six and sixty month implementations, a zero month implementation, deliberately poor modernization assumptions, a five hundred position book, a four hundred thousand position book, a free platform and an absurdly expensive one. Every answer is directionally correct and no case produces a negative cost line.
Three things are worth naming, because the workbook went through three rounds of review and each one made the number smaller.
The first version valued deferred capital at the full investment spread, which put fifty one percent of the answer on one soft input. It now uses the spread given up while capital waits, which is the honest quantity.
The second version charged the whole implementation in year one while granting a full year of modernized economics in that same year, with an input sheet that said the build took fourteen months. Benefits now phase in.
The third version charged the year-end headcount requirement for the whole year, and let severity event frequency drift upward with position count even though the user had entered it explicitly. The ceiling now charges mean staffing across the year, and an entered frequency stays the frequency entered.
Across those three rounds the illustrative five year NPV fell from $2.79 million to $906,998. The smaller number is the one that survives a committee, which is the entire point of the exercise.
The version number is on the Read Me tab. Check it against the version at the top of this page to see whether your copy is current. The form asks for an email so I know who is using the workbook. There is no mailing list.
