I was taught ROI at a very early age – almost as soon as I started learning the ABCs. Back then, though, it was just called “life’s lessons”. My Dad, being a first generation born Italian-American had learned these lessons from his father, who had come across from Italy at the age of five. My Dad wanted to pass these “life lessons” to me as his Dad had to him.
One of the first lessons was on the difference between things that you need and things that you want. This one simple lesson provides the ability to properly evaluate and determine the value of almost anything.
It was really quite simple: the things that you need – like shoes, clothes, schoolbooks, protective goggles, tools and a tool belt –, allow you to either:
1. Function as needed
2. Protect you from potential disruptions or issues
3. Do things better or more effectively
On the other hand, things that you want – like comic books, baseball cards, chewing gum, pop-rocks and records – are there to
1. Give you some sort of enjoyment
2. Provide some sense of conforming to the norm
3. Don’t need to be so readily accessible
For my grandfather – coming across to a new country, without much money and not being able to speak the language – it was very easy for him to determine the “ROI” of things. He spent most of his life focused on acquiring things that he needed. As we look to apply ROI to business -- and specifically technology purchases -- the discipline that was adhered to by my Father and Grandfather rings true in making the right business decisions. Related to technology, you need to spend money on solutions that:
1. Allow you to function as needed – to manage your daily workflow, communications and processes
2. Protect you from potential disruptions or issues – whether these be outside challenges like new regulatory requirements, changing market conditions or internal challenges, new rules or compliance guidelines
3. Allow you to do things better or more effectively – solutions that allow your workforce to be more productive, provide your decision makers better business intelligence or efficiencies, which can translate into cost-reductions or better customer satisfaction
Call it what you will – Return on Investment or a “life lesson” –ROI is what drives both, our daily and strategic decision in life and in business.