Delivering promised returns in the channel

James Hall notes that optimal conditions for delivering on customer promises rarely exist

Return on investment (RoI) is an over-used, often-abused term. We are all quick to make RoI promises, but how do we arrive at the figures, and do we go back to customers to make sure they get the promised returns?

A technology investment needs to deliver measurable efficiency. Often, this is by automating a process or increasing productivity. In our primary market, WAN optimisation, you can calculate savings by comparing alternative solutions.

The customer is normally contemplating a large increase in bandwidth with the associated recurring costs, so we might be able to quantify savings per year of additional bandwidth costs.

If products and services can be delivered for less, and deliver the same or better data transmission speeds or specific application performance at users' workstations, you have a case for investment. Improved WAN performance may also deliver other efficiencies such as enabling transatlantic videoconferencing. As benefits accrue, the initial investment starts to look smaller.

Many sales and marketing people may also include less tangible benefits in their customer presentations. There is nothing wrong with doing this, but they are notoriously hard to define, measure, and value in monetary terms.

Soft metrics might include improving employee behaviour, job satisfaction or team work. They might equally be tied to improving customer service – providing faster delivery, resolving complaints more quickly, and retaining more customers.

You sometimes need to look hard to see all the potential positive effects for customers of the technology you are trying to sell.

You must also be transparent about the total costs of a proposed offering. It is not just about the purchase price, but the operating costs. Any maintenance and support contract costs must be factored in, whether incurred in-house or through your own business or a third party.

There are also the costs around decommissioning existing technology, cancelling contracts and end user training. Don't forget any additional energy costs.

Some tangible benefits, such as process efficiency through reducing manual workarounds, will require mapping of old processes and possibly even running time in motion studies to assess actual time spent doing a task targeted for automation or improvement.

Finding out if you can improve employee or customer satisfaction will require original research, such as surveys, staff interviews or mystery shopping exercises.

Some offerings will deliver the advertised RoI only in optimal conditions. Virtualisation is a classic example: I have seen many virtualisation projects that do not deliver promised RoI.

So you must run a pilot in situ, working with the other systems with which it will be required to interface. Avoid the risk of overselling or even mis-selling, which only damages the potential for building long-term customer relationships.

James Hall is marketing director at Teneo