Computing the Business Value of IT

September 10, 2009 · Filed Under business value, IT Estimating  - 1 Comment(s)

While I am a strong proponent of examining the business value of IT systems in terms of return on investment, net present value, internal rate of return and other quantified measures.  There are some additional considerations that should be used with prudence:

  • Intangible Benefits: For example improved customer satisfaction, better image.
  • Additional Future Benefits From Groundwork Laid By This Project:  For example: deploying a new CRM system that lays the groundwork for a human resources system within the same structure.


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Comments

One Response to “Computing the Business Value of IT”

  1. Bryn on September 14th, 2009 12:13 pm

    The most recent PMI Project Mgt Journal has an article “The Rational Choice of Not Applying Project Risk Mgt in IT Project”. I thought it would say what type projects shouldn’t bother with risk mgt. Rather, it talked most about why companies frequently don’t use the info that RM generates, even with the high rate of failed and troubled projects. The business value of ALL activities should be considered – if no return (either because of low payoff OR data isn’t used to managem projects), no investment is wise. Conversely, activities with proven ability to improve the bottom line should be pursued even if it warns of expensive impacts.

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