Finding ROI White Paper
The specific benefits accrued from a successful intranet and/or corporate portal deployment can range from hard and soft cost savings, to improved employee retention and reduced time-to-market. Prescient has done considerable research in the area of intranet and return on investment (ROI) benefits and has segmented them into the following 10 categories:
- Hard Costs
- Application Access
- Time To Market
- Customer Service
- Human Resources
- Business Case & ROI Planning
Intranet ROI examples include:
- Oracle, IBM and Cisco all measure the impact and benefits of their intranet. And all of them have measured the value to be greater than US$1 billion. In fact, IBM has realized benefits from e-learning via the intranet to alone be more than US$284 million.
- Sodexho USA: SodexhoNet: One of SodexhoNet’s more innovative and successful tools is its SuperSleuth sales lead program. SuperSleuth is an intranet web page and application that encourages employees to submit sales leads and prospective clients via the intranet. The SuperSleuth intranet page generate cash rewards of up to $1000 for the person making the submission. Sodexho says it has contributed to a 100% increase in sales leads in the past year. Let me repeat: a 100% increase in company sales leads. In fact, the SuperSleuth tool has led to US$90 million dollars in managed volume (net client sales including sales by client). Proof positive of a killer application.
- Financial service client (700 employees): All total this client measured savings from only 12 measurable benefits at a 2-year value of more than $1.5 million. Their investment in the intranet was less than $200,000. Therefore the 2-year ROI was more than 700%.
The Intranet Business Case
The bottom line: the intranet needs to prove its value before more money is spent. However, a business case is more than just dollars, cents and return on investment (ROI).
Building a business case involves taking stock of the current state, defining an ultimate business goal, and putting in place mechanisms to measure the success and benefit of achieving the organization’s goals.
To measure dollar value and ROI, initial baseline measurements are taken for defined criteria, which then allows for comparisons and gauging success at a future point (6-12 months out is standard).
Prescient has in fact identified more than 140 specific line item benefits for measuring intranet ROI (more on Intranet ROI) . Some of these benefits include:
- Software distribution – self-service downloads that save the IT department time and cost
- Newsletters & print materials – online publishing reducing costly print & distribution
- Contact information & directories – online publishing replacing print & spreadsheet distribution
- HR forms – online self-service replacing very costly, traditional administration
- Time tracking – online time card submission replacing traditional methods
- Email usage – migration of traditional email communications to the intranet saving server space, management and maintenance
- Content management – database-driven intranet publishing reducing the complexity and time required (and reliance on IT or Communications) for online publishing
Despite the potential reward, more of our clients are asking about ROI, but a Prescient Digital Media study showed that fewer than 6% of more than 240 companies surveyed actually measure specific dollar and cent benefits derived from the intranet.
Prescient has particular strength and knowledge in counseling companies through business case development including determining existing and potential return on investment (ROI) for major e-business projects, particularly intranets.
Appraising the value of a site/portal is not an exact science, but may be an invaluable exercise for determining the potential dollar value of the client's investment. While measuring the precise return on investment may not be possible (given the wide-ranging value and implications on the organization including hard and soft savings, and potential increased revenue) there are means by which to quantify both potential and existing ROI which may be applied to the site/portal.
This module includes the identification of key areas of cost savings/cost avoidance (CS/CA). Data culled from these key areas will then be applied to conservatively agreed targets and benchmark examples, to determine the approximate ROI value of the site/portal project.
Please contact us directly for assistance in measuring the ROI benefits of your intranet or to develop an intranet business case.