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Projecting ROI for your intranet: Don't bother
Monday, November 15, 2004A corporate intranet that successfully improves collaboration and knowledge-sharing is of immense value. The greatest value comes from random, profitable events--a salesperson coming across information that helps him close an important deal, or a developer avoiding a costly mistake by reading a cohort’s posting. But forecasting serendipity is impossible. Too many variables exist to accurately forecast the future effect of an intranet implementation.
So you can’t tell your stakeholders how much their intranet will save them (or make them). Any business case would be inaccurate and impossible to verify. Instead, the senior team has to simply believe that the intranet will be a strategic asset. They have to go on their gut feeling. How can you create that gut feeling?
Ask your audience to consider things like this:
250 employees x 1 hour/ week x 49 weeks x $30/ hour = $367,500/ year
1000 employees x 1 hour/ week x 49 weeks x $30/ hour = $1,470,000/ year
Using this calculation, your intranet for your company with 1000 knowledge workers will save time valued at about $1.5 million.
In any event, your goal is not to deliver a precise ROI dollar figure. Rather, your goal is to offer so many convincing lines of reasoning that any idiot can see that the intranet will be of strategic importance to the company. ROI may be clear-cut for, say, a new piece of equipment on a manufacturing line. But in the knowledge industry, ROI is difficult to ascertain, if not impossible.
About the Author
I'm Chris McGrath, an intranet consultant in Vancouver, British Columbia, Canada. I've been working on intranets since 1997, and on plain ol' web sites for even longer. I run One Intranets, the firm that co-created ThoughtFarmer -- an enterprise collaboration platform for Windows-based intranets.
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