In their book Making Technology Investments Profitable: ROI Road Map to Better Business Cases, Jack M. Keen and Bonnie Digrius make the case for business cases, walk through the process of creating a business case, provide insights for finding and…
Like the formula for Net Present Value (NPV) explored in an earlier post, break-even analysis is based on a time series of cash inflows and outflows. It is simply the time required for the discounted cash inflows to equal the…
As I mentioned in my prior post, the traditional ROI formula does not consider time. But in weighing the costs and benefits of a project, we must take into account the fact that neither costs nor benefits materialize instantaneously, each…
Recently, I reviewed a book on calculating ROI, but today I’d like to call into question this iconic phrase. The formula for calculating Return on Investment (ROI) could hardly be simpler. Just subtract the cost from the gain and divide…
I hear the term ROI often enough but rarely see it calculated. It is said that business is all about numbers– financial statements, stock prices, bonus plans–but then there are IT projects, with budgets that are clear enough (or at…
Jim Downey 