1. Return on Investment An Introduction to Establishing Value and Using ROI for Managing and Marketing Jane M. Conroy

2. What is “Return on Investment”?  Definition: Return on Investment (ROI) is a measure of an organization’s ability to use assets to generate additional value for those contributing resources to that organization.

3. Why is it ROI important?  Funder confidence  Public accountability  Marketing  Additional funding  Management tool

4. Who is the audience and what does ROI mean to each of them?  Funders  Legislators – Local, State & Federal  Public  Management  Staff

5. Levels of ROI measurement - Program - Agency - State aggregate - National aggregate???? (think big)

6. Needs assessment to outcome measurement: an iterative process Assess Need Implement Solution Evaluate Results Incorporate Improvement … a diamond in the rough, continually refining…

7. ROMA logic model Accountability Agency’s client case record and client notes. Shelter log, client case record and notes. Planning Families are at risk of being evicted or are homeless. There is a lack of affordable, safe low- income housing. ©The Center For Applied Management Practices ROMA Logic Model 1.0B – Example (P40) Program: Housing Assistance √ Family  Agency  Community Mission: To ensure that all families have access to safe, clean shelter and to help families obtain safe affordable permanent housing. Identified Problem, Need, Situation Service or Activity Outcome Indicator # and % of clients/units to achieve each outcome Measureme nt Tool Data Source and Collection Procedures Frequency of Data Collection and Reporting Intervention 280 families receive emergency housing assistance or support: Emergency rent payment for 150 families. Emergency shelter for 50 families. Result of Intervention Families remain in their own residence. Homeless families obtain emergency shelter. Result of Intervention 150 of 150 or 100% of families remain in their own residence 30 days. 120 of 150 or 80% of families remain in their own residence 60 days. 100 of 150 or 67% of families remain in their own residence 90 days. 50 or 100% of homeless families obtain emergency shelter lasting no longer than 30 days. Accountabil ity Housing Assistance Form Housing Assistance Form Accountabi lity Activity reported daily, entered into agency MIS. Weekly report generated to department head. Same Transitional housing for 60 families. Families obtain temporary subsidized housing. 50 of 60 or 83% of eligible families obtain and remain in transitional housing for a period of 180- 360 days. Same Public Housing for 20 families. Unsubsidized rental (0) Home Ownership (0) Families obtain permanent housing. 20 families are placed into public housing. Same City public housing records reported to case- manager monthly. Same

8. Tying funds to outcomes:  Challenges in data collection, indirect costing, and cost per outcome - Too many outcomes (select one) - No allocation of administrative costs (use percentage distribution of admin. costs) - Cost per outcome is per outcome, not per client served

9. Savings & Revenue  Return on investment can show up as: - Savings (costs not incurred) - Revenue (dollars generated) - Both

10. Savings  Examples of Savings: - Unemployment costs averted - Homelessness prevented - Emergency room visits avoided - Teenage pregnancies prevented - Ex-offender recidivism reduced - Seniors kept in independence

11. Revenue  Examples of Revenue: - Earnings of people placed in jobs - Increased earning ability of trained workers/GED achievers - Value of volunteer labor - Micro business jobs created - Value of local housing stock

12. Outcomes, percentages of success, and ROI: some examples

13. Calculating ROI – Keep it Simple Annualized Savings per outcome + Annualized Revenue per outcome divided by total costs of trying to achieve outcomes = ROI …. and that is your…… First Year Return on Investment

14. Adding it up – Conservative & Defensible

15. Where to go for backup data?  Google is your friend (search engines)  Universities – existing studies or student projects  Self-study & tracking

16. Presentation & Communication  Audience  Style considerations  Audience comprehension: From sound bites to detail

17. CSBG & Leverage

18. We are aiming toward: Progress, not Perfection ….if we needed perfection, we’d have died out a long time ago

19. Success Stories - some examples  Lynchburg Community Action Group – Transportation Program  VACARES – funding restored by the Governor  VA CAA ’ s: only non-state entity to receive TANF earmark from General Assembly during budget cuts  VA CAA’s: no overall cuts

20. Questions????? jmconroy44@earthlink.net