Soar to Success June 2016

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How to Calculate
Your Technology ROI
BYJEANNEDEWITT What is your Return on Investment or ROI when purchasing
new technology? For many businesses calculating ROI can
be tricky especially when it comes to IT spending. Find out
some tips on calculating your technology ROI.
Whenpurchasingnewtechnology, howoften
do you consider its return on investment?
Here are a few tips so you can gain a better
understanding of technology ROI and how
you can calculate it in your business.
1. First should you consider ROI before or
after you make a technology purchase?
The answer is both. Before purchasing,
you want to carefully consider whether
a technology service or product is worth
your money. Then months after you’ve
implemented it, you should analyze whether
or not you made a good investment.
2. How to calculate ROI. When calculating
ROI, it doesn’t have to be perfect. Here is
a simple formula to get you started. ROI
= net gain/cost. Example, you spend $100
and make $150. Your net gain is $50. ROI =
50/100 = 50%......... If you’ve yet to purchase
a service or new equipment, you obviously
don’t know how much profit it will generate,
so you’ll have to do a bit of guesswork
and estimation. It’s also important to
consider some intangibles. Think about the
productivity costs of staff time, disruption,
and frustration. Think about how much
time your staff will save if you implement,
say for example, a Managed Services
solution? With your employees no longer
having to put out IT fires daily, what if your
entire staff saves 50 hours a week because
of it? How much does that add up to in
saved salary expense? It’s important not
just to think about the savings in time, but
also what your staff could be doing with
those extra 50 hours. They could put those
SOAR TO SUCCESS / June 2016 / Core Business Strategy