Business Value with Oracle

Part Two: Definition and Measurement

Will our savings and increased revenues surpass the investment?
This is the most basic form of examination.  You will be laying money on the table for software licenses, yearly manufacturer and/or implementation partner support and maintenance, consulting services and training (system administrator and end user), content conversion and loading from your existing system(s) to the new system (if needed) and integration with other systems (if needed). So, will the savings and increased revenues to be realized, be greater than those invested? Depending on the cost of your overall investment, the span of time required for payback is generally a multi-year proposition.  Three to five year payback period calculations are common and estimates for today’s value of future returns are generally predictive.

Will this initiative “pack a mean punch?”
I advise selecting a project or initiative that is of importance to a high profile person within the organization. An inaugural project, for example, should be visible but not overwrought with risk.  If successful, can a positive project experience lead to a “spring boarding” effect? In a word, yes. When project goals are clearly defined, met, and even exceeded, momentum can be established.

What else can be achieved and what else can I get?
There is an upside and downside here.  For example, with some in depth research and/or experience, you may be able to negotiate a better deal for your organization.  However, you don’t want to “beat down” your chosen supplier to the point that they cannot afford to support you in the manner that will produce the greatest results. Additionally, a ‘bargain shopping’ philosophy requires time and effort as other vendor offerings are examined. The right balance must exist between that which can be realistically achieved versus the time, cost and complexity of analyzing competing offerings.

Are “soft” costs a component of your equation?
Many times the answer to this question depends on your company.  Examples include intangibles like improved morale or happier employees. Financial systems don’t generally take into account these costs.

See Part One here

Part One: Strategic Objectives and Planning

Ask yourself, what are you trying to accomplish based upon this investment?
Sounds simple, doesn’t it? Think about what you are trying to achieve in terms of the benefits realized. For example, your two main goals for investing in enterprise content management might be to eliminate six disparate repositories and thus improve the quality of your corporate content.  What are the benefits of this transition, realizing the more benefits the better!  Just as important, how will these benefits be measured in real terms?  In our example above, by successfully eliminating six repositories, you will likely end annual maintenance payments on those repositories.  Add up the figures.  This concrete dollar savings could be significant!

How specifically will the business benefit?
Speak with the employees that will be most impacted by the proposed changes.  Solicit their feedback and involvement PRIOR to the decision being made. Ask questions like “Do you ever re-create a piece of information that you know exists but that you cannot find?”  Have a business user illustrate a problem or two they face on a daily basis in the context of doing their job. Describe in detail a post-implementation world and the benefits that result.  In the above example, first demonstrate how to tag and check in a piece of content.  Second, explain how to search for and retrieve that same piece of content. Finally, the end user will conduct the exercise themselves.  Encourage them to practice, which will breed confidence and acceptance.

How extensive of an analysis do you need?
In my experience, this question is not asked often enough.  Please understand that a detailed ROI analysis can be a major undertaking.  Each company operates differently in this regard.  How are investment decisions made at your company? Balance current company resource commitments with the appropriate amount of needed information for effective decision making.

What happens if we do nothing?
Don’t forget risk evaluation.  There are two main areas of evaluation, the project: examples include newness of technology/solution or size, and context: examples include availability of personnel based upon current workload or even a broader element to consider such as a pending merger or acquisition.