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

Unlock Productivity and Say Goodbye to Business Inefficiencies

Running a business can feel like a constant battle against inefficiency. There are innumerable reasons an organization doesn’t meet productivity standards. Fortunately, however, technology provides powerful tools to identify and eliminate these problems. Here's how you can use technology to find and fix inefficiencies in your business. Analyze Data with Business Intelligence Tools A great way ...

Big Data Initiatives Can Give You a Better Idea on the Best Ways to Run Your Business

Big data is now a crucial resource for businesses of all sizes, including small enterprises. Today, businesses have unprecedented access to vast amounts of data, enabling them to make more informed decisions and operate more efficiently. This month’s newsletter explores how small businesses harness big data's power. Customer Insights and Personalization Understanding customer behavior is vital...

Three Ways to Prevent Technology Problems in Your Business

Do you ever wonder why some businesses seem to have endless technology problems? It’s not by accident. It's often a matter of not having the smart, simple habits in place to combat issues that present themselves. Let’s take a look at three ways that your business can avoid big technology headaches. Spotting Trouble Early Staying proactive is the key. Good IT professionals do the same for your ...

Video Conferencing Offers More than Before

Video conferencing has become a must-have tool for businesses, especially after the rise of remote work due to the COVID-19 pandemic. It used to feel like something from science fiction, but now it's a key part of how we work together. Video meetings are not only more reliable and easy to use, but they've also become a lot more accessible, helping people connect no matter where they are. Let's tak...