Brad Callahan
Vice President, Business Solutions Group
February 8, 2012

Are You Capturing The Real ROI of Your Programs?

Markets are volatile, costs are rising, your customers are squeezing your margins as they push for the best possible “deal,” and— if yours is like most businesses these days—you’re doing more with less and increasingly called upon to justify every expense. At no time has demonstrating return on investment (ROI) been more important, especially the magnitude and timing of investments relative to engagement programs with both tangible and intangible benefits. Which brings to the surface a critical question: Do today’s business professionals really have their arms around ROI?

It appears many do not. And if you are measuring ROI, are you confident that your measurement process is producing the most accurate data, data that can be directly linked to a specific objective? Gone are the days when a program’s return could be reported in ethereal terms. For example, how do you get an accurate measure of the impact of your sales incentive program? Sure, you might say, we had a spike in sales soon after rollout. But are you sure it was the sales incentive program or was it something your marketing team did? Or was it a mix of both, and can you tease out the ROI and confidently identify the contributions of each? How do you measure the bottom line impact of your loyalty programs or softer-side of recognition in a way that is valid, credible and actionable? Are your key findings good enough to convince the C-suite or are you merely talking ROI speak? Instead of talking about ROI can you actually show it?

The Incentive Research Foundation has taken a step in that direction with the launch of a . The tool takes incentive program planners through a process that shows how to estimate ROI for a program, think through cost aspects, assess potential adverse effects and create budgets.

Another approach, the ROI Methodology™, designed by the ROI Institute, is a continuous improvement process that measures program results in a way that accurately captures both hard and soft measures, along with their respective attribution, impact and return.

Given the current business environment, assessing the full spectrum of a program’s impact and return is the new norm, and it requires everyone to roll up their sleeves. How are you approaching it in your organization? What issues do you encounter that make measurement difficult? What do your successes look like? We’ll be exploring ROI measurement in depth in upcoming blogs and we’d appreciate your thoughts.

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