1. Enter the project investment

• Update the default investment amount to the total funding required for your project, including R&D, equipment, capital, etc.
• Enter the number of quarters for the expected investment duration from project start until launch. Note 1 year = 4 quarters

2. Enter expected project profit

• Enter the total profit the project is expected to generate and the number of quarters over which that profit will occur.
• To keep it simple, the model assumes that both project investment and profit follow a normal distribution.
• Profit can be based on gross profit or another financial measure used by your organization.

3. Enter the discount rate

• Enter the annual discount rate you use to evaluate project investments. (Most companies use a rate between 10% and 15%, depending on cost of capital and project risk.)
• Enter 0% when you do not want future cash flows to be discounted.

4. Estimate the reduction in time-to-market

• MAHD commonly achieves an average time-to-market improvement of ~25%, so the estimator uses 25% as the default assumption.
• Adjust this percentage to reflect your expected level of MAHD adoption and/or improvement.
• You may also apply the same percentage reduction to the project investment. This option is selected by default because a shorter development cycle commonly reduces development costs at the same rate.

5. Estimate the increase in profit

Enter the expected increase in total profit expected from using the MAHD Framework. This value can be difficult to estimate, but potential sources of improvement include:

• Increased sales or market share
• Stronger competitive differentiation & reduced discounting
• Higher customer value leading to pricing increases
• Lower product costs, including bill-of-material, warranty, service, and support expenses

Our experience indicates that organizations implementing MAHD generally improve the value delivered to customers, although the resulting financial impact varies by product and market. When project-specific data is unavailable, a 10% profit improvement is typically a reasonable and relatively conservative starting assumption.

6. Update and review the results

After changing any assumptions, click UPDATE RESULTS to recalculate and see the comparison between the Traditional and MAHD approaches across several measures, including:

• Net present value
• Incremental value created
• Time-to-market
• Time to breakeven
• Cumulative discounted cash flow throughout the project

Click along the graph to compare the financial difference between the two approaches at each quarter.