Feeds

DIY e-biz ROI flatters to deceive

Bring on the Consultants!

  • alert
  • submit to reddit

High performance access to file storage

Just how well is that e-business project going? What exactly is the return on the investment (ROI)? If you are, in common with 80 per cent of so big companies, calculating the ROI in-house, you could be deluding yourself.

Companies assess their e-business ROI through rose-tinted glasses, consistently reporting better results than those who subject themselves to third-party assessment, Jupiter Media Metrix says.

The Web analyst firm bases its conclusion on its survey of 471 senior executives of firms with an annual turnover of more than $50 million.

Almost 60 per cent of inhouse ROI assessments generated a positive result, according to Jupiter, which suspects that in many cases this is merely a "self fulfilling prophecy".

Worse, DIYers use "nconsistent definitions of ROI metrics in an effort to show positive results, therefore making it nearly impossible to correctly choose which projects should be funded and which should be killed".

So what is to be done? Jupiter urges business managert to @precisely and consistently define financial metrics such as ROI, rather than attempting to 'guesstimate' a dollar value when there is no justification for doing so".

Also, companies must "separate hard dollar ROI calculations from soft dollar 'relationship metrics' such as Return on Relationship, which is a metric specifically designed to capture the impact of the Web on customer relationships".

This sounds very fuzzy to us: how do you work out a Return on Relationship? Jupiter has the answer - nearly. It is currently developing a Relationship model and will be publishing a report on the subject in a few months.

Jupiter may have its work cut out on converting the masses - right now, just 17 per cent of big businesses use external consultants to assess their e-business ROI. Many companies don't bother to measure their e-business ROI at all. ®

High performance access to file storage

More from The Register

next story
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
Sorry London, Europe's top tech city is Munich
New 'Atlas of ICT Activity' finds innovation isn't happening at Silicon Roundabout
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
prev story

Whitepapers

Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
SANS - Survey on application security programs
In this whitepaper learn about the state of application security programs and practices of 488 surveyed respondents, and discover how mature and effective these programs are.