Return on Investment
Are you getting the most from your Investment?
Budgetary pressures within any organization mean that ROI is always an important consideration when it comes to investment in IT infrastructure.
ROI traditionally refers to financial benefits (revenue increase or cost reduction) but businesses are more often considering non-financial benefits.
Operational efficiency, higher customer satisfaction levels, better information systems and shorter cycle times may not be viewed primarily as financially beneficial,
but the effect that they have on the growth and sustainability of a business can be significant.
Intangible or "unquantifiable" benefits can often be a challenge to identify and measure but should always be throroughly examined.
Some common questions that can be asked related to the ROI in IT infrastructure are:
MIPS costs are just one example of costs that can build up to take a significant portion of a budget. Assessment of an infrastructure to leverage technology that can reduce such costs should be carried out to provide possible feasible alternatives.
This can be a complex task; however, improvement in performance needs to be accurately measured so that before-and-after comparisons can be made. This can involve metrics built into processes and well designed KPIs
Metrics such as payback period, net present value, internal rate of return are sometimes good for assessing the current ROI. Reviewing past ROI can often aid in current decision-making. Financial ROI calculations should also take into account all measures that can be done financially e.g. reduction in staff turnover can be calculated as cost savings in areas such as recruitment, training and productivity.