How to Ensure Your IT Yields an ROI

How often do you find yourself thinking about how new technology will impact your business’ bottom line? Chances are, you have considered implementing a new piece of technology or two, but you might get stuck on whether or not it will actually be worth the investment. This is where you consider the return on investment that technology will provide, or ROI. Here’s how you can make sure your technology is providing results and what you can do if it doesn’t get the results you’re looking for.

Breaking Down ROI

Return on investment can be simplified as making back the money you spend on implementing a tool or service for your business.

While it’s not very appealing to spend boatloads of capital on new technology, it’s difficult to deny that it’s often necessary for businesses to invest large sums into new hardware or software in order to remain operational. New solutions can be more intrusive on your productivity and time, but you have to think ahead if you want to ensure your new solution is actually going to fulfill the needs of your business. You’re not thinking about the immediate needs of your business so much as the near-future needs as well. That’s what investment is; you want to make more in the future than what you’re spending today.

You’ll have to be comfortable with a little bit of risk, but you should only invest in a solution where you’ve worked to calculate the ROI it can offer. This should help to limit the guesswork involved.

Calculating ROI

Here’s a simple equation you can use for calculating ROI:

ROI = ((Net Gain) / Cost) * 100

Net gain is calculated as how much you spend minus how much you made. For example, you might spend $50 to make $100, and your net gain would be $50.

ROI = (50/50) * 100 = 100%

That’s a nice, shiny 100% return on your investment, or double the money you put in, which is great to see.

Know That Net Gains and Costs Aren’t Always Clear

Net gains and costs can be a bit nebulous, however, and they might need a little more digging to figure out.

For example, you need to consider operating costs, implementation costs, payroll, opportunity costs, and more to get a clear idea of your net gains. These are all tough to pin down, but you need them if you want to calculate the most accurate ROI possible. When thinking about ROI, it helps to imagine it as the amount of time spent or saved, along with the initial cost of implementation.

If all this sounds like too much to deal with, we get it. That’s why White Mountain IT Services is here—to help you make the best IT decision possible for your business. Get started today by calling us at (603) 889-0800.

White Mountain IT

Related Posts

Tip of the Week: Zip and Unzip Compressed Files

Have you ever seen the file types that look like normal folders, but they have a zipper on the icon? These are ZIP files, and they are helpful for a variety of reasons. We’re sure you have encountered zipped files throughout your time using technology, and today, we want to demystify them a little bit and show you how to use them effectively. What are Zipped Files? The easy way to explain a ZI...

The Hidden Dangers of Outdated Hardware and Software

One of the greatest threats to modern businesses is a cyberattack and the consequent data breach. These types of threats often target outdated systems that haven’t been patched or upgraded with fixes to vulnerabilities. Today, we want to go over some of the most likely outdated hardware and software issues you might encounter on your own infrastructure so you can address them and keep your busines...

How Does CAPTCHA Work?

We’ve all had to confirm we’re not a computer when attempting to log into an account. This is the core purpose of what once was called CAPTCHA… the Completely Automated Public Turing test to tell Computers and Humans Apart. However, it seems surprising that computers don’t easily overcome these simple-seeming tests. Let’s dig into why these simple tests actually are effective at differentiating b...

The Technology Behind Professional Services

Professional services encompass many of the “experts” people rely on, and today’s firms in this sector depend heavily on technology to boost efficiency, enhance client service, and streamline operations. In this month’s newsletter, we’ll explore four key technologies that professional services firms rely on.  Project Management Software Project management software is a cornerstone for pro...