Return on Investment

 

A key decision maker in procuring any business tool is your return on investment. Measuring ROI can be a difficult process for tools which give a hard-to-measure effficiency gain across an entire business. Listed below are some of the common benefits resulting from implementation of ISAAC.

 

 

Benefits can be classified in two ways:

  • Hard benefits result in a tangible cash benefit. Strong ROI models typically derive the majority of their benefits from hard dollar savings.
  • Soft benefits are not easily quantifiable in hard dollar terms. Although they don't provide a cash benefit, soft benefits are important because they quantify other factors that may be important when evaluating whether to proceed with the investment.

 

Sample benefits Benefit classification Benefit description
Reduced head count Hard Reduction of labor costs for staff members involved with the business process covered by the software.
Reduced errors Hard Reduced cost associated with revising work or handling errors within the old process.
Increased revenues Hard Increased sales directly attributable to the new application technology.
Productivity savings Soft Value of reduced effort spent on the process, which can't be tied directly to cash results.
Improved quality Soft An intangible measure of product, customer service, or operational effectiveness that is often difficult to tie to cash results.
Improved customer, employee, or partner satisfaction Soft Perceived improvements in stakeholder satisfaction that are difficult to tie to cash results.
Improved information Hard or soft Improved decision-making that results from having access to timelier and/or more accurate information, which leads to improved business results or productivity gains.

 

 

Some tangible examples of this would be

  • Reduced head count   Improvements in process efficiencies result in a mandate for 10% reduction in staff. or more optimistically, the displaced workers could be retrained to perform more valuable jobs within the organization.
  • Reduced errors   Fewer defects associated with the new process lead to less reworks.
  • Increased revenues   Improved customer management ensures higher sales.
  • Productivity savings   Employees no longer waste time searching through manual paperwork. Instead they spend only half that time by efficiently accessing data by using the new software program.
  • Improved customer satisfaction   As measured by an external customer satisfaction survey, the ratings of our clients have improved from "okay" to "great" in terms of getting the right product out in the right timeframe.