Measures expected benefits

Quantitative and qualitative assessment

ROI enables decision-making

Must evaluate relevant variables

Requires understanding of service

Results included in business case

ROI evaluates:

• Cost savings
• Business growth
• Performance improvements

1. Process

• Define purpose and scope
• Collect data
• Review and analyze
• Calculate
• Report and decide

1.1 Define purpose and scope

ROI scope set by:

• Strategy objectives
• Choices and decisions
• Solutions
• Stakeholders

ROI aims:

• Required data ?
• Data gathering ?
• Data use ?
• Metrics ?

1.2 Collect data

ROI categories:

• Outcomes
• Positive risks (opportunities)
• Costs
• Negative risks (vulnerabilities/threats)

Outcomes	Positive risks (opportunities)	Costs	Negative risks (vulnerabilities/threats)
Cost savings Performance Automation Revenue increases Productivity increases Waste reduction Regulatory compliance Business continuity	New services/products New markets New distribution channels	Design costs Development costs Project costs Migration costs Operating expenses Licenses Maintenance Staff costs	Data exposure Greater attack surface Loss of control Vendor lock-in Uncontrolled purchasing Inability to innovate

 

1.3 Review and analyze

ROI assess VOCR data

Includes workload rates

Analysis sets baseline

Intangible recorded

Highlights:

• Variables and impacts
• Cost of doing nothing
• Option costs

Results:

• Potential impact
• Introduced risks
• Risk redutions

1.4 Calculate

• 100% represents break-even
• >100% required to proceed

ROI calculation omits intangibles, two options:

• ROI calculation then list other variables or use scenarios
• Assign a value to intangible then include in the calculation

Neither method perfect. Stakeholders should:

• Verify intangibles
• Agree on calculation

and :

	Benefits	Costs
Tangible	Revenue from new markets Revenue from new product or service Increased sales/new features Reduced expenditure	Marketing campaigns New distribution channels Research and development Upgrading technology Cloud migration Cloud services
Intangible	Customer loyalty Brand visibility Employee satisfaction Ease of use	Cultural change Skill degradation

1.5 Report and decide

ROI presented in business case

Present to:

• Decision-makers
• Technical advisors

2. Moving to the cloud

ROI demonstrate:

• Value of moving existing workloads
• Value of moving services to the cloud
• Introducing new cloud-based services
• When existing services should be retired

Apply to:

• Cloud strategy
• Individual services

Not a general comparison

Use a specific scenario to compare:

• ROI of using cloud services
• ROI existing in-house solutions

Decision taken based on which ROI provides the best business case in this scenario

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