Return on Investment Calculators and the iPad
Return on Investment (ROI) or Total Cost of Ownership* (TCO) calculators are important aspects of the sales component model. Especially during recessionary markets such as we’re in today, all corporate purchases need to be justified through a close inspection of overall organizational benefits and associated costs. ROI models can be an incredible tool for the sales force – bringing rational and justified assumptions and data to a largely emotional sales process. However, these tools are typically flawed and can sometimes negatively impact the sales process. In this article we’re going to review the use, challenges, and vision for how we see the iPad playing a role in fixing this process.
Return on Investment Calculators Today
As an organization, Propelics has worked with dozens of custom built ROI Calculator or ROI spreadsheet models. These have been built by our customers to support their sales team selling into buyers. From computer hardware, software licenses, and IT services within the technology industry, to pharmaceuticals, heath care, automotive, manufacturing and other industries, we’ve seen a wide variety of these return on investment tools in use by our customers over the past 20 years. We have commonly seen these characteristics:
- Typically created initially by a product manager or engineering group, these start as TCO tools that later have benefits “bolted on” by sales or sales management.
- Meant to be standardized, ensuring that each sales representative can use the tool to support the sales process. Look and feel, spreadsheet tabs, analysis questions, assumptions, and definitions are defined for the sales team.
- Hopefully, this tool is meant as a bridge to increase the customer’s experience by providing an understanding of the ROI of your product or service. The whole process is not so much about the end result number, but just as much about the assumptions and how this final number was achieved. This justification structure is incredibly important to the process.
The Challenges of iPad Return on Investment Calculators Today
Like many corporate data assets, the ROI Calculator can become stale over time. The assumptions and calculations used require consistent maintenance, and without a formal structure to keep this information correct we begin to see the following challenges:
- Typically these tools are “modified” by the sales team for each specific opportunity based on the needs of the customer. Unfortunately, these changes are rarely backed out and the results can be permanently skewed going forward.
- Nine out of ten times, these tools are highly engineered Excel worksheets. Supporting large macros, button actions, assumption tabs, reports and other features. They’re extremely easy to break.
- Excel output doesn’t translate into beautiful output for presentations, with sales reps taking screenshots or copying/pasting output into PowerPoint with limited success in branding or readability.
- These can be typically sent to customers, including the ability for customers to view the guts of the engine. Allowing customers to view assumptions, pricing, or other sensitive data.
- Distribution and version control is non existant. Is our entire sales force using the most current version? Right assumptions in place? Current pricing? Typically, these tools are emailed between sales reps as needed which creates additional fragmentation.
- Finally, without central distribution it becomes impossible to track usage or modifications in the field.
Our Vision for the ROI Calculator
The Return on Investment component is just a small part of our vision for sales enabled applications on the iPad. The sales applications we’ve built for our customers have multiple components including: Company Information, Product Information, Customer Experiences/References, ROI Calculator, Quoting/Pricing Tool, Support Docs, etc. These applications highlight the simplicity of the sales process and are 100% customer facing.
For the ROI calculator, here are some of our guiding principles in developing solutions for our customers:
- First and foremost, Customer Engagement. The ROI models we’ve built for our customers have a clean front end, supporting our defined factors of ROI calculations in the areas of cost, benefits, risks, and assumptions. Gone is the cumbersome Excel spreadsheet, replaced by a corporate iPad application that follows the organization’s branding and requirements.
- Integration. As we’re creating a customer product quote within the same unified tool, we utilize this quoting information as a basis for the ROI calculations. The quote line items end up driving ROI components.
- Managing Transparency. With a tool such as this, we can control the amount of visibility our ROI calculations have. We can highlight areas of ROI calculations that help the customer provide their business case, and conversely hide assumptions or other factors not appropriate for client (or sales team) to view.
- Distribution and Versioning. As a distributed application, we have the ability to force updates on the end users to ensure that the entire sales team is using the correct model and the ROI calculations presented are valid.
- Customer Data Linkages. The ROI calculation on its own is important, but the ability to link components of the ROI model to specific product data sheets, customer reference videos, web-based information, or customer installed asset data begins to tie this ROI calculation deeper into your customer’s reality. The key with all ROI models is to bring trust into the calculation, and the ability to tie as much of the customer’s environment into the ROI brings credibility.
The return on investment component of any sales process is an important one. As organizations struggle to ensure there is consistency to the message across the sales team, as an iOS Enterprise Developer and iPad Developer, the Propelics team feels that a standardized ROI calculation engine within a customer facing iPad application is a major differentiator to your competitors.
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* Total Cost of Ownership (TCO) models are typically just the cost components of the Return on Investment (ROI), and while TCO calculations are important on their own, we feel that the benefit component of the ROI is too important to leave out. For the purposes here, we’re going to focus on Return on Investment only.