VOI is a methodology for evaluating anticipated costs and benefits of proposed projects. Benefits for K-12 include monetary benefits (such as cost savings and staff productivity enhancements) and qualitative benefits which are oriented to achieving district or school mission, goals and mandates, or the strategic plan.

This approach can be used to evaluate the comparative costs and benefits of two or more projects competing for the same funding, to sell a project, to articulate the costs and benefits of the project to constituents, and to later determine whether a project should be sustained.  The steps to follow when performing a Value of Investment assessment for a proposed project follow:

1. Estimate Project Costs (Project TCO)
   To properly implement and support the technology project, all initial and ongoing direct costs need to be budgeted. However, to determine the relative value of the proposed project, budgeted costs need to be annualized and indirect costs (user overhead time) need to be considered; these combined annualized costs are the project TCO. CoSN has provided a free web-based Project Cost Estimator to help you to identify and summarize all of these costs. An Excel version of the Project Cost Estimator is also available for you to download.
   
2. Calculate Anticipated Savings and Revenues
   Most projects, even those focused on qualitative benefits such as student achievement, have some cost savings such as lower out-of-pocket costs, better efficiencies, user productivity or future cost avoidance. There may also be some anticipated increase of revenues based on higher attendance, grants or state/federal aid. The Project Cost Estimator allows you to identify and apply infrastructure and support savings to the project cost, and the VOI Project Benefits Worksheet will help you to identify other dollar savings and user productivity enhancements and apply them as benefits.
   
3. Measure (Score) “Qualitative” Benefits
   Since the business of schools is education and schools operate for the public good, many or most of the benefits of implementing technology can not be measured in terms of dollars; we call these qualitative benefits. For these to be considered benefits they must directly or indirectly affect the school or district mission, goals or mandates. CoSN has provided a VOI Project Benefits worksheet to help you to identify and apply these qualitative benefits. The suggested approach to calculating these anticipated benefits is:
   • Determine school or district mission, goals and mandates, and assign a relative importance to each
   • Align anticipated project benefits with the appropriate school mission, goals and mandates
   • State the anticipated project benefits in measurable terms
   • Agree on the effect of the proposed project on applicable mission, goals and mandates. (On a weighting of -10 to +10, how much will the project affect each mission, goal and mandate? Note the possibility of negative effect)
   • Come up with a total qualitative benefits score
   • Multiply the total qualitative score by the probability of success for a risk-weighted benefits score.
     
4. Assess Risk
   Risk, as used for the purposes of VOI calculations, is more appropriately viewed as the probability of success for the proposed project. Probability of success is most appropriately applied to the valuation of the expected benefits of the project (Note that probability of success could also be applied against cost to create a risk-weighted cost). Although actual benefits if realized aren’t lowered by a lower probability of success, this factor must be considered when determining whether a project is worth doing, or which project competing for the same funds makes most sense to pursue. There are approaches that have been developed for the corporate world that evaluate risk for technology projects; CoSN has not yet investigated this area and suggest that for now, a general consensus of the school or district project team reach a consensus on the probability of success.
   
5. Was it worth it? - Evaluate Results
   Once your wildly successful project has been implemented, you have an opportunity to objectively review actual costs and benefits versus the projected costs and benefits. This will allow you to concisely respond to the project skeptics. Since the anticipated costs and benefits were stated in measurable terms, the actual results can be measured:
   • Actual costs versus anticipated costs
   • Actual savings or revenues versus anticipated savings revenue
   • Actual measurable benefits versus anticipated benefits