VOI is similar to ROI (Return on Investment) used by businesses, but since schools are not in business to increase top and bottom line revenues, many benefits can not be stated in monetary terms. For this reason, we use measurable qualitative benefits as a part of the value of investment. However, for projects designed specifically to enhance revenues, save money or enhance staff productivity, a ROI calculator is available as part of the Project Cost Estimator workbook.
The VOI methodology is best applied to major projects with the purpose of objectively analyzing the anticipated costs and benefits of these projects. The tools provided are the online Project Cost Estimator, which provides the means to determine the initial, implementation and ongoing costs of a technology project; and a Project Benefits worksheet, which can be used to better understand and articulate the benefits of any project (not just technology).
Reasons for performing a VOI assessment of proposed projects include:
Evaluating whether a project, is worth doing, or which project offers best value towards the school or district mission
Helping to sell a project to constituents
Articulating the costs and benefits of a proposed or implemented project
Sustaining a project when it is time to reinvest
Getting Started - The Project Team
Measuring qualitative benefits of a proposed is not a science and requires consensus among a respected diverse group - the project team - to be accepted by the rest of the community. Along with IT representation, the project team should include anticipated users and others affected by the project, such as administrators, teachers, students and perhaps outside community members.
Consensus is not always easy to achieve and miniority opinions need to be accounted for. See the PERT approach for Establishing Group Consensus for Value of Investment for more information.
Tips for Your VOI Assessment
Cost Model - CoSN provides an online Project Cost Estimator. This tool allows entry of initial, implementation and ongoing costs, as well as indirect labor costs, with reports showing initial/ongoing costs as well as project TCO, which amortizes initial costs and adds in ongoing annual costs, including indirect labor. If a TCO assessment has been performed using the CoSN-Gartner TCO tool, some of the input can be obtained from this TCO assessment.
For budgeting purposes, initial and ongoing budgeted costs need to be estimated. When interested in real annualized costs for project comparisons, then indirect labor should be figured in to the project TCO.
The Project Cost Estimator also contains a sheet for calculating Return on Investment and pay-back period for proposed projects.
Benefits for All Projects - Each of the project benefits needs to be stated in measurable terms. The litmus test is to ask yourself, "Will I be able to measure or prove whether we have met this benefit?" A good way to state most benefits is, "'Measurement' will increase/decrease from 'X' to 'Y' by 'date'." See some examples of benefit statements.
In order to better articulate the value of the proposed (or existing) project, specific benefits need to be related to district mission, goals, mandates or strategic plan - issues of interest to the constituents. See examples.
Comparing Costs and Benefits for Different Projects - Costs and dollar savings (including staff productivity) can be compared. However, there is no standard measurement for qualitative benefits, so VOI implements a project scoring model. The scoring model is optional and desirable primarily in situations where two or more projects are competing for the same funding.
The scoring approach used by CoSN's VOI initiative is to (1) determine the relative importance of the District mission/goals/mandates (or items in the strategic plan); then (2) estimate the effect that each benefit of the project will have on any of these district objectives.
Read the specific instructions on the Intro sheet of the Project Benefits workbook.