In Today's World, Quantifying business value hard dollar benefits and relating it to applicable business terms is a key driver for most Executive decision making. Here is a a quick snapshot of some of the Business Benefit categories for consideration when calculating these benefits
Business Operating Efficiency
Business Operating Efficiency is a project benefit used in calculating the benefits of a project or initiative and the ROI. Calculates the impact the project has on the business units and operating expenses. These impacts include helping to increase productivity, reduce the risk of productivity losses, avoid purchases, reduce expenses and reduce overhead. Business Operating Efficiency calculates the project's impact on reducing key corporate operating expense includes including: Cost of Goods Sold (COGS), Sales and Marketing (S&M), General and Administrative (G&A),Research and Development (R&D), Interest Expenses and Depreciation.
Business Strategic Advantage
Business Strategic Advantage is a project benefit used in calculating the benefits of a project or initiative and the ROI. Calculates the impact the project has on the corporate revenue and sales. These impacts include helping to increase sales productivity, customer acquisition and loyalty, increase sales effectiveness or the launch of a new business. The benefits are reflected as impacts to Revenue on the corporate financials. Thecalculation includes impact on revenue, and a calculation of net margin contribution of the benefit. The net margin contribution of the benefit is what is actually used in the net benefit, TCO and/or ROI calculation.
IT Cost Reduction is a project benefit used in calculating benefits and ROI. Calculates the increases in IT productivity, reduction in headcount, purchases, support, maintenance, contracts, facilities and overhead. Savings get mapped to specific IT budget categories to analyze the impact on the IT Operating Budget, which includes the following categories: Data Center and Servers, Distributed Processing, Purchased Software, Purchased Services, Communications, Development, Maintenance, Operations, Overhead Supplies and Other. As well, IT Cost Reductions affect the corporate budget, particularly helping to reduce IT expenditures contributing to General and Administrative and Depreciation.[Read More