While previous posts mentioned several successful examples in Enterprise 2.0, people might wonder if these companies gain enough revenues to cover the cost of using Web 2.0 tools in their business. Therefore, this post is going to discuss how to measure the Return on Investment (ROI) of Enterprise 2.0.
Some experts claim that effective collaboration, knowledge, and information coming from Enterprise 2.0 are intangible assets and it is difficult to show the ROI of these assets because“intangible assets such as knowledge and technology seldom have a direct impact on financial outcomes such as increased revenues, lowered costs, and higher profits” ,according to Bob Kaplan and David Norton, the authors of a book called Strategy Maps: Converting Intangible Assets into Tangible Outcomes.
However, some believe that it is possible to calculate the ROI of Enterprise 2.0 by using a few metrics. Carolyn MacNeill mentioned that the return of the ROI of Web 2.0 collaboration could be showed by “number of contributors to the community”, “number of comments”, “number of ratings”, “number of documents circulated/shared”, “number of days a new employee is up and running”, “number of days a new project is completed” and “number of days/minutes a customer support issue is identified and solved”. Furthermore, Cameran Hetrick emphasized that companies could analyze the benefit of Enterprise 2.0 via several ROI measurements such as employee engagement, turnover and sales. She pointed out that,
Employee Engagement: Most companies already conduct annual surveys to gauge the level of workforce engagement. By measuring and aggregating engagement ratings, companies have one rating per employee.
Turnover: Using companies’ employment records is a good way to identify the employees that have turned over since companies launched their network.
Sales: To focus on the results of the sales team can measure the impact of Enterprise 2.0 on sales. However, companies will need to acquire the same data and make sure that their account for other factors that might impact sales.
It is clear that calculating the ROI of Enterprise 2.0 would be the best way to persuade organisations that using Web 2.0 is beneficial to their business once the ROI has been measure by advanced analytics.