ROI (Return on Investment) is the metric that compares the gain generated by an investment with its cost. It can be expressed as a percentage (net gain divided by cost, multiplied by 100) or as a payback time (months or years until the investment pays for itself). It is the lingua franca of the corporate investment decision.
Calculating the ROI of IT projects requires discipline. Costs are relatively easy to measure (licences, implementation, training, support). Benefits are subtler — reduction in administrative time (hours × cost/hour), reduction in errors (how many errors × average cost), revenue increase (directly attributable to the project?), stock reduction (freed capital × cost of capital), higher customer satisfaction (translated into retention and volume). Each of these requires a baseline before and measurement afterwards.
In INFOS proposals, ROI scenarios are built with the customer, with explicit and conservative assumptions. An ERP promising to pay for itself in 6 months is usually an unrealistic expectation; one that pays for itself in 24-36 months with conservative assumptions is typical of successful implementations. After 12 months in production, INFOS frequently revisits the assumptions with real data, validating or adjusting the picture of value delivered.