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No two projects are the same, therefore no two ways to determine a projects return on investment are alike, either. If there were an accepted formula to calculate ROI, decision-making would be a lot easier. But no such luck, especially if regulatory issues and market pressures are involved. Still, if you can pinpoint your return effectively, youll obtain a detailed business plan for the future.BY ROBERT REGIS HYLE

Hard as it is to believe, the concept of return on investment (ROI) has been around for a while. Yes, its had different namessuch as ...

By Robert Regis Hyle | Updated on October 31, 2003

Hard as it is to believe, the concept of return on investment (ROI) has been around for a while. Yes, its had different namessuch as business justificationbut even in the good old days companies were reluctant to spend money without some idea of how the investment would be recouped. Today, though, the acronym ROI is on the lips of every technology and business leader. But what is ROI? The term seems simple enough, yet those who work to determine the benefits of a major project know there is nothing simple about it. Different companies have different ways of evaluating potential investments, says Jack Tyniec, managing director of TCi Consulting & Research. Those criteria may not be the same for an investment like, for example, an acquisition of another company vs. the acquisition of a new technology or an improvement in a process internally.

Bill Taylor, vice president of operations for AXA Re P&C, has been in the insurance industry for over two decades, so he is used to pushing through projects without the benefit of any ROI methodologies. He has seen the value of such a program, though, and understands why insurers are buying into such methods.

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