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Return on Investment: Determining and Communicating the Project Value

Companies are demanding reliable financial measures of proposed projects’ values. Yet project managers often don’t know how to identify, calculate or communicate a project’s ROI (return on investment).

Traditional ROI calculations are increasingly being criticized for telling only part of the necessary story – afflicting all types of projects, but often causing the greatest difficulty in areas like IT, where benefits may seem intangible and frequent overruns impact the credibility of estimates.

Uncover 22 pitfalls that render common ROI determinations meaningless, and learn instead how to calculate a project’s real value.

This course can be applied to the following certificates:
Business Analysis Certificate
Project Management Certificate

Who Should Attend

  • Project managers
  • Business and systems analysts
  • Business managers and product owners
  • Engineering and systems managers and professionals
  • Quality/testing professionals and auditors

Benefits and Learning Outcomes

  • Identify full-story key effects on revenue and expense variables
  • Quantify tangible and intangible costs and benefits and convincingly communicate the business value of project investments
  • Practice applying practical techniques to a real case
  • Understand ROI and related calculations, strengths, weaknesses and common pitfalls
  • Objectively account for quantified risk, flexibility and timing impacts on realized revenue
  • Present and report business value measurements so people pay attention

Course Outline/Topics

What Does Money Have To Do With It?
• Project Manager role with regard to ROI
• Situations demanding ROI, their issues
• Difficulty of making convincing arguments
• Linking ROI to the business case
• ROI Value Modeling” Relationship Diagram
• Investment vs. expense
• Justification vs. objective analysis
• Meanings of “It costs too much”
• Total Cost of Ownership (TCO)
• Factors other than cost to be considered
• Costs and benefits, revenues vs. expenses
• ROI calculations
• Net present value, discounted cash flow
• Payback period, annualized return
• Internal rate of return (IRR), hurdle rate
• Issues with typical ROI usage
• Economic Value Added (EVA)
• Scenario approach to showing benefits
• ‘Telling the story’ behind ROI calculations
• Mistakenly thinking ROI does not apply

Determining Meaningful Benefits
• Why it’s important to find the benefits first
• Treacy’s model of revenue categories
• Problem Pyramid” to find requirements
• Decision variable clarification chain
• Putting a dollar value on intangibles
• Opportunity, innovation, and flexibility

Estimating Credible Costs
• Problem Pyramid” ties costs to value
• Basing costs on implementation of design
• Business case framework
• Basic formula for estimating costs
• Main causes of poor estimates
• Top-down vs. bottom-up techniques
• Risks that afflict ROI calculations
• Three measurable ways to address risks
• Best-, worst-, most-likely-case scenarios
• Defining a reasonable scenario for success
• Getting reliable cost and revenue amounts

Reporting and Monitoring
• Single vs. multiple scenario presentation
• Scenario assumptions and parameters
• No change vs. proposed scenarios’ ROIs
• Measuring intangibles’ monetary effects
• Continual, step-wise, and one-time changes
• Presenting with spreadsheets
• ROI Value Dashboard” modeling tool
• Using value modeling to improve decisions
• Dashboard and scorecard-type notification
• Capturing, calibrating with project actuals
• Adjusting appropriately during project

Robin was very knowledgeable and well prepared to teach this topic. He encouraged class participation, which was most beneficial.

— Kevin Napieralski, Aptar Inc., class participant

All sessions are Face-to-Face unless otherwise noted.

Fri., Sept. 30


Location: UWM School of Continuing Education

Instructor: Robin Goldsmith JD

Fee: $450

CEUs: 0.7, PDUs: 7

Enrollment Limit: 24

Program Number: 5025-9511

Registration Deadline: Fri., Sept. 30

Register Now