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

2. 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?

3. 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

4. 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%)

5. 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

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

7. 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

8. ROI: Getting Projects Approved

9. 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:

10. 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!

11. 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:

12. 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)

13. 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