I forwarded this sheet from Stephen Walli’s presentation on the Gartner OSS Summit to a friend. We were having the discussion that selling people software based on cost reduction is bogus because in most cases that amount of cost reduction is never going to be realized and is not really that relevant.
Turns out we were right. From the deck:
Return on Investment …is bogus?
- Return on investment (ROI) is no longer seen as a key indicator of what does and what does not make technology investments work, a poll of 400 IT and financial directors in the UK has shown
http://www.theregister.co.uk/2002/07/09/roi_faulty_as_measurement/
- Brian Hadfield Managing Director of Unisys UK told ComputerWire that ROI is best viewed as a “trailing indicator”
- Executives polled for the survey see value in the ability of IT to increase customer satisfaction, improve information access or allow better knowledge sharing
- Innovation, improved revenue and reduced costs were not seen as being closely tied to the IT function, turning on its head the belief that technology is best sold on the promise of reduced costs or improved revenue
