A formula to show diminishing returns

Diminishing returns for more effort
You will be very familiar with the law of diminishing returns, where you get a lot of payback for your initial efforts (sometimes called ‘low hanging fruit’), then you have to work harder for smaller rewards. An example for IT professionals might be a server or application consolidation project. Hacking and Stacking produces good early $ savings, but as you go through the project, you need to work hard to get less reward.- then the ’80/20′ rule comes in to play.

Expressing as a formula
In this kind of scenario its hard to come up with a ‘finger in the air’ estimate of what the savings could be when embarking on such a project, since the savings are not going to be linear. I was looking for a simple formula that could be generally applied to such projects  and came up with this.

=( SIGN(A2) * $E$1 * (SQRT(2 * (SIGN(A2) * A2 / $E$1) + 1) – 1)  )

here A2 is the value to be tweaked, and E1 is the ‘aggressivity’ of the diminuation of the result. For a VB version of this and some examples and downloads, please take a look at this article.

About brucemcp 225 Articles
I am a Google Developer Expert and decided to investigate Google Apps Script in my spare time. The more I investigated the more content I created so this site is extremely rich. Now, in 2019, a lot of things have disappeared or don’t work anymore due to Google having retired some stuff. I am however leaving things as is and where I came across some deprecated stuff, I have indicated it. I decided to write a book about it and to also create videos to teach developers who want to learn Google Apps Script. If you find the material contained in this site useful, you can support me by buying my books and or videos.