What Is Software ROI, and How Is It Defined?
Return on investment (ROI) is a rather overloaded term that means different things to different people. In some cases it means the value of the software activity at the time it is undertaken. To others it is the value of the activity at a later date. In other cases it is just a catchword for the difference between the cost of software and the savings anticipated from the utility of that software. To still others there is a more complex meaning.
One traditional measure of ROI for any activity, whether software related or not, is given as
ROI = Average Net Benefits/Initial Costs
The problem with this model for ROI is the accurate representation of average net benefit and initial costs.
Commonly used ...
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