the Research presented at InfrastructureStrategies
ROI on IT
Industry Veterans share their Views
ROI (Return on Investment) on IT is no longer optional;
it is rapidly becoming a requirement prior to any capital
investment in IT. In the recent Network Magazine-ORG-MARG
survey (Infrastructure Strategies 2002), 34 percent
of the IT Heads said they consider ROI as an important
decision-making parameter for an IT investment.
on an ROI model
of technology ROI in an organization depends on the type
of investment one has made and should be looked at on
a case-to-case basis. There are some complex financial
models that allows you to calculate the ROI.
structure to processes
Calculating ROI is an inevitable function in today's
low-growth business environment. There isn't any structured
tool to calculate ROI. A cautious approach before deploying
a project and awareness of common mistakes will put
some structure in the ROI process.
mixed bag of returns
the process of calculating ROI on technology investment
is important, it depends on a mixed bag of situations
Reality or illusion?
ROI exercise is useful but the figures achieved are
tentative. The returns may be judged in terms of quantity
take-off on ROI
has crossed the line of being an enabling tool and has
interwoven with business processes to become a part
of an airline's life. In such a situation, it's a difficult
challenge to measure ROI on IT expenditure.
are myriad of mathematical models like NPV and IRR to
calculate returns but they may not give you a true picture
of ROI. In cases like ERP, SCM, and CRM projects ROI
is an elusive element.
ROI in the right direction
the current state of economy every investment has to
pass through a financial 'gate' which allows only justifiable
investments to pass unhindered. A smart IT Head will
think ahead and figure out means to justify the essential
IT projects that are necessary for the organization.
on IT-Not much quantity
it's natural for the higher management to ask for ROI
on IT investments, it is difficult to set a quantitative
value to it. On the other hand, the qualitative benefits
that are difficult to put on paper, are very high.