• Static Network Diagram Software (1st Generation)
  Such as Visio.   Like any general-purpose diagramming software, it is a piece of electronic paper that network engineers write any network symbols on.  Low cost and no network intelligence. 
• Static Network Diagram Software with Auto-Discovery (2nd Generation)
  Such as Opnet NetMapper and Solarwinds LAN Surveyor.  This type of tool has network discovery capability.  Trained engineers can build static Visio diagrams of predefined areas quickly, leveraging the discovery results. 
• Dynamic Network Diagram Software (3rd Generation)
  Invented by NetBrain.  Dynamic diagramming software automatically builds network diagrams from underling data-model...  There is Smart Object behind each network symbol - which enables dynamic network diagram update itself when live network changes; capable of diagnosing performance issues and even simulating the network changes.  Check out full capabilities of dynamic network diagram.  Besides automating network diagram,  dynamic network diagram software is also a visual troubleshooting and design platform.

• Is your network well documented now and infrequently changed?

  If your network is well documented and rarely changes, a static network diagram tool such as Visio may serve your needs well. Otherwise if your network lacks accurate documentation to start with and frequently changes, consider a 3rd generation dynamic diagramming tool, which allows you to create network diagrams automatically using data collected from live network.  If network diagramming task is about a portion of the network such as certain LANs, a 2nd-generation tool is also fine.

• What is the size of your network?
  The complexity of network diagramming goes up exponentially with the number of network devices. If your network has less than 15 network devices (routers, switches or firewalls), a 1st generation software such as Visio is the best fit.

  For medium size network with up to 100 network devices, the 2nd generation tools or entry-level 3rd generation tools may be a good investment. 

  For large network with tens of thousands of network devices, investing an enterprise-grade 3rd generation tools should be considered.  In some cases, a 2nd generation tool could be a good fit as well, if the sole purpose is to create a set of static network diagrams and no need to keep them updated. (e.g. for one-time network assessment.)
  

• Is your business subject to security compliance requirements?
  Does your industry have to comply with security standards such as PCI, SOX and HIPPA?  If you do, then look into 3rd generation diagramming tools with advanced documentation features.  Your organization is required to document every network changes - having network diagrams alone is not be enough.
• What's required by your job?
   For a casual user of network diagram, the 1st-generation tool is enough.  For a full-time network drafter, consider investing a 2nd-generation or 3rd-generation tool.  For troubleshooters or network consultants looking for diagram automation for complex network, evaluate the 3rd-generation diagramming tool.  3rd-generation diagram tool enables you to work on unfamiliar network instantly because it not only can create diagram on-the-fly, it is a full-featured network design and troubleshooting environment.

A network diagram is required by virtually every network tasks. As a result, diagramming automation is an investment in productivity gain across board.  3rd generation tools integrate network troubleshooting, network design and network assessment with network diagramming process - making the return on investment as short as 6 months.

In real world, every engineers spend significant amount of time in diagram-related tasks - building new diagram, update an old diagram or work off an existing diagram.  Assuming diagram automation saves 0.5 hour each day for those tasks, it adds up to $6,250 saving each year.

* Based on annual salary of $70k