A new way of measuring return on investment (ROI), developed by analysts and academics, is taking hold in the industry and a cutting-edge group of IT managers are adopting the new philosophy. This new intangible ROI measures are based on things such as product quality, time it takes to market the product and customer satisfaction. The new approach is very different from the past approaches, which were based mainly on cost savings. One concept in intangible ROI is that deciding when to buy new technology is as important as deciding what to buy. Factors such as timing of a project launch, systems upgrade or factory expansion can determine when to buy new technology. There is no clear data on the number of companies that are actually using the intangible ROI concept. Over 25% of IT managers surveyed said that there is no reliable comprehensive metric available to determine ROI. (author)

Report Date: 1997-06-30
5 Data & Analysis Center for Software