One of the biggest challenges that someone charged with overseeing a Continuity Program has is to prove that the program is worth its cost: “What is your program’s ROI?” I call that the “dreaded question.” I would like to propose another way to frame this question. What if continuity planners talked about value on investment versus return on investment?
The “Dreaded Question” of Return-On-Investment (ROI)
So here’s how the questions are often framed:
- “What’s the return on investment (ROI) of your continuity planning efforts?
- “How much will you save the company?”
- “How much will you make for the company?”
- “What does this do to the company’s bottom line?”
Answering these questions can get really tricky. You might reply with something along the lines of, “Based on our BIA (business impact analysis), we know that our plans will protect us from any significant downtime. That downtime is projected to cost us <<fill in the blank>> dollars per second that we are down.” The executives around the table raise their collective eyebrows and one of them goes in for the kill and asks, “When did that happen last and how much did it cost us?”
Gulp. More than likely, you lose that round.
The traditional definition of “ROI” means – very literally – “return on investment.” That means that you need to prove that the company received the same amount of money back – or more – as it invested in your program. You can always point to your BIA, point to your planning efforts, correlate the two – and pray for the best. If a serious outage occurred, it’s a pretty easy argument. However, if you’re like most BC/DR professionals, you likely have had no disasters or plan activations, or – worse yet – the situations you faced were easy.
You will never win this one with that kind of response.
But what if you stopped and thought about things differently? What if you changed the entire conversation? In other words, is there another, perhaps more meaningful, way to show value? The questions I’d like to ponder here are:
- What is the value-add of business continuity?
- Is that value-add only good in a disaster?
- Is there a way to show value to the organization on a daily basis?
Here’s Another Option: Value on Investment (VOI)
Is it possible to tie dollars invested to desired – and realistic – company outcomes such as:
- Increased resiliency?
- Competitive advantage?
- Effective staff training?
- More thoughtful business processes?
Overwhelmingly, the answer is ‘yes,’ and to do that, we now need to discuss value and Value on Investment (VOI).
Value on investment was first defined by the Gartner Group, which described it as the intangible assets that contribute heavily to an organization’s performance. The keyword there is intangible. These intangible assets include knowledge, processes, organizational structure, and ability to collaborate – which is what BC/DR does! So VOI is the measure of the intangible benefits of a project or an activity. And just by the very nature of things, VOI will include some aspects of ROI – but that’s not where you want to end up. You will want to talk about value.
Shifting to a VOI approach instead of an ROI approach provides the necessary forward-thinking framework for scoping, prioritizing, and initiating continuity projects. For example, in response to the executive’s question, what if you said this instead: “We use the concept of VOI because we are working to measure the idea of creating company resilience, of tying planning outcomes to increased employee skills, and of creating value through collaborative planning and learning at every level of the organization.” Wow, that sounds great!
VOI helps measure the total value of “soft,” or intangible, benefits derived from continuity initiatives, in addition to those “hard” benefits measured by ROI. VOI is, of course, subjective and would be difficult to measure with the same precision as ROI. Yet a VOI approach is critical to allow funding for continuity planning efforts that provide the competitive differentiation necessary for the success of the efforts.
And, by the way, BC/DR professionals aren’t the only ones who struggle with this. When you research this topic of VOI versus ROI, you will find many groups working through the same questions, including organizations and programs such as higher education, not-for-profits, professional associations, think tanks, and technology initiatives. You are not alone!
Start by Changing the Conversation
The first step begins with changing the conversation – move it away from ROI to VOI. There are many ways to do that; one of my favorite ways is to spend some deep and quality time discussing three basic questions:
- “What is the company <<fill in the blank>> (business continuity, disaster recovery, etc.) program doing now that provide value to the company?”
- “What should the <<fill in the blank>> (business continuity, disaster recovery, etc.) program begin doing that would provide additional value to the company?”
- “What [am I/are we] doing to provide value to the company?”
How do you, as an individual or group, begin to get your arms around these questions? One way to start is to have what we call a “whiteboard activity.” The whole purpose is to expand and deepen your thinking about what the program is doing now and/or could do, and identify what everyone is doing to contribute to the success of the program’s mission.
Here are some ways to set up a great brainstorming environment to capture ideas. These will help make that whiteboard activity really pop!
- Establish goals for the session.
- Set a timeline for the session.
- Give everyone on your team a homework assignment: Bring to the session at least ten ways that the program provides value. They can be silly ones, great ones, boring ones – bring any and all of them!
- Create the environment for success. Be prepared at the start of the meeting with sketchpads, sticky notes, colored markers, or a large amount of whiteboard space for everyone involved.
- Write down and/or sketch out every idea. Every idea, good or bad, should be presented.
- Don’t judge. Embrace the ridiculous! At the end of the day, it might be the best idea in the room.
- Start with general topics and then move towards the specific.
- Look for synergy among the ideas. There is often potential for creating synergy among originally separate suggestions.
- Don’t fall in love with your ideas. Shop them around and see how they hold up.
Viola! You are making progress!
Where Do You Go From Here?
Now that you are, perhaps, thinking about things a bit differently, you have work to do:
- Get your team together to “whiteboard” the value question.
- Have your elevator speech ready.
- Be ready to share the top five (at least) values on investment that your continuity program provides to your company.
- Start spreading the word.
- Start today!