BI Project Approval “A challenge in getting BI projects approved is establishing their return on investment (ROI)” Hugh Watson, 2015

ROI: Getting Projects Approved Establishing ROI is difficult We need tangible benefits with believable numbers to get our projects approved (or to at least have a chance!) But how exactly do we do that?

ROI: Getting Projects Approved Step 1. Identify an organizational pain—i.e., the PROBLEM Ask yourself, what “problem” is your project going to solve? Example: Current churn level is 20% and that is costing us $XYZ per year

ROI: Getting Projects Approved Step 2. Communicate how your project will solve the PROBLEM Estimate impact Example: My BI project will build a model to accurately predict which customers are likely to abandon us and when they are likely to do so. If we know that we can contact them in a timely manner to try and convince them to stay (e.g., special offer). The model is likely to reduce churn rate to 18% (from 20%)

ROI: Getting Projects Approved Step 3. Quantify the benefits Calculating ROI for the change Example: Use increased revenues (along with associated costs) from reducing churn to estimate ROI. Then, communicate how long it will take for the project to realize full ROI

ROI: Getting Projects Approved Identify Problem Estimate Impact Calculate ROI Step 1 Step 2 Step 3

ROI: Getting Projects Approved Prepare the “proposal” The need for the project Anticipated benefits Development plan Project cost Required resources Prepared by business unit Prepared by BI team

ROI: Getting Projects Approved

ROI: Getting Projects Approved Assessing benefits versus costs Calculating ROI (step 3) requires you to quantify the benefits and costs of your project “Unlike some IT systems that replace more expensive systems BI's benefits are often "soft" or intangible. While there may be some ROI metrics that support a business case, BI projects often require a bit of faith on the part of the people writing the checks and some savvy selling by IT and business users” – Frank Brooks, former Chief Data Architect at BlueCross Source: http://searchbusinessanalytics.techtarget.com/news/1507270/Business-intelligence-ROI-Five-keys-to-justifying-BI-investments

ROI: Getting Projects Approved Assessing benefits versus costs Calculating ROI (step 3) requires you to quantify the benefits and costs of your project Estimate how much time is saved per access relative to how long it took to get the information in other ways—Gatorade went from 1-4 hours with MicroStrategy to 3 minutes with QlikView Multiply the number of user accesses by the average time saved per access by the average salary rate for users—Gatorade saved $237 in employee time for each report generated!

ROI: Getting Projects Approved Making benefits believable How many clients will this new reporting tool help us gain or retain? – Frank Brooks What is the business value? How am I driving the business forward? – Jim Burton (Gartner Analyst) Push ROI justification problems back to a potential vendor “and if they can't help you justify the investment, you really have to question whether you want to go with that supplier”– Gerry Brown (Towcester Analyst) Source: http://searchbusinessanalytics.techtarget.com/news/1507270/Business-intelligence-ROI-Five-keys-to-justifying-BI-investments

ROI: Getting Projects Approved Making benefits believable Get executive sponsorship “It makes easier to sell “soft’ benefits – Howard Tripp (Towcester Analyst) Downplay and/or exclude benefits that might be questioned Don’t rely on unquantifiable benefits to sell your project (but record them anyway to make your business case)

Conclusion When trying to get a BI project approved … Identify a problem, estimate the impact of your project, and calculate ROI Write a proposal Specify the need for the project, place benefits before costs, and develop a plan Quantify the benefits of your project in $ and make them believable