Sharing Experiences, Tools and Templates
There were two reasons why I started the Smart Lemming. First, I wanted to share my career management experience from a knowledge worker perspective; my management and leadership experience from a C-level perspective; and my career management strategies and tactics moving up from a knowledge worker to a C-level. Second, I wanted to share my tools and templates with other knowledge workers. I was a product marketing manager and product manager for technology companies so I’ve many used, created, or amalgamated sales and marketing templates over the years. However, since started my knowledge worker career, I’ve collected and customized other tools and templates for return on investment (ROI), competitive intelligence, business case analyses, etc.

Return on Investment in Sales and Marketing Process
Today, I’ve sanitized a customized ROI tool that I used as a sales and marketing tool, combining from two different ROI templates created by others. When I was a product manager/product marketer, I always looked for ways to help the sales team sell the products that I managed. In the sales process, you always here from the prospect, “sounds great…I like the product, but what’s the return on investment?” If you are lucky, you actually have a product that generates increased revenue, savings from cost avoidances, or other benefits that you can measure. These measurements (or ROI calculators) are often extremely proprietary to your company’s product; however, the basic means to measure the ROI and payment period are not.

Combining Two ROI Tools and Templates into One
I found the business book, ROI Selling: Increasing Revenue, Profit, and Customer Loyalty through the 360 Sales Cycle, by Michael Nick, Kurt Koenig that outlined the ROI selling process and provided the ROI Financial Dashboard, complete with calculations. This book also provides marketing advice on how to use the ROI Financial Dashboard for marketing materials. Once I found this book, I realized it was the perfect compliment to another ROI MS Excel template that I found by Odellion Research. No longer in existence, Odellion specialized in ROI financial concepts, tools and templates, and consulting. I had purchased a simple ROI cash flow model from Odellion, but saw an opportunity to combine it with Nick and Koenig’s ROI Financial Dashboard and the proprietary ROI calculator I was using.

Simple ROI Cash Flow Model
Odellion provided a simple cash flow model for ROI by outlining three categories of increased benefits and two types of costs. The example I’ve provided below shows two types of costs: one-time costs like implementation or installation fee and recurring costs like annual license fees. The beauty of this form is: the column layout of years or term of the contact for benefits and costs and the ROI percentage for the first year, ROI Average, and the Pay Period.

ROI Financial Dashboard
After reading ROI Selling, I created the ROI Financial Dashboard worksheet in Excel. From my experience, this tool provides a compelling visual depiction of the ROI or your product or service. Of course, this assumes that your proprietary ROI calculator is sound and the prospect buys into it. Nick and Koenig’s approach uses three basic blocks on information:

• The ROI financial summary (ROI Selling Investment, Savings from Revenue Increases, Savings from Cash Flow Improvements, Savings from Cost Avoidances, and Savings from Paper Reduction, and Estimated Savings)
• ROI Financial Dashboard summary metrics (Return on Investment Percentage, Payback Period: (Months), Start-up Factor (Days), After Payback Period, Monthly Cost to Wait)
• Key Pain Indicators (my example lists the need for Increased Revenue, Cash Flow issues, inability to avoid Costs, and Paper volume)

Basically, I used this tool only when the prospect was highly qualified and had an intent to buy. I trained the sales team on how to collect the data for ROI calculator tool. At times, I had to present the ROI findings to the prospect since the sales rep preferred that I explained the anticipated benefits and costs, the return on their investment in our product, and the payback period.

I recommend buying, reading, and mastering the Nick and Koenig approach. Once you do this, you may be able to come up with your own ROI calculator to identify the benefits gained from using your product (this is the hard part), and then modify ROI Financial Dashboard & Simple ROI Cash Flow template so it uses your benefits and costs from your product.

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