Lately the emphasis for data driven decision-making and planning has become stronger than ever. With budgets shrinking and demands increasing, time and money must be used in the most efficient and productive manner possible. While the act of calculating ROI takes time, for large investments or analyzing past significant investments in order to determine whether or not to repeat them, the time to do such an analysis is well worth the payoff. One caveat to the use of ROI analysis is if an investment is going to be made regardless of what the ROI is likely to be, positive or negative. In this case, time is better spent making sure the investment is made in the best manner possible.
A major perk of using ROI analysis includes supporting and adding credibility to certain investments you may try to convince your boss or board members to make in these tight fiscal times. Training programs, for example, often get cut during times of budgetary scarcity; however, an ROI analysis can help you build the case for continuing with a good program that sets employees—and, therefore, the organization—up for long-term success. When the short-term picture is bleak, ROI analysis brings the big picture back into focus. When the people with decision-making power remember to put things in perspective using data, better decisions are made. The creation of a data-driven culture leads to sound, analytical methods becoming second nature across the agency, benefiting the organization and its clients.