Let’s begin with the basics: What is ROI?
Return On Investment is a broad and often misinterpreted term—but it doesn’t have to be that way. By simplifying the way we think about it, and evaluating some key metrics and signals at our fingertips, we can get much closer to understanding how the investment we’re putting into scientific research is turning into valuable, meaningful outcomes.
In the simplest sense, ROI is generally defined as the ratio of net profit over the total cost of the investment. But when we get into a bit more detail, there’s lots more to track and be aware of when it comes to understanding our impact.
Beyond calculating the ratio of cost to profit, we can look at our return on research investment from a few other key angles:
• Risk Mitigation
How much did our research efforts reduce the likelihood of potential related risks or future negative outcomes?
• Cost Reduction
How much did our research efforts reduce potential future costs of research or future phases of our objectives?
• Cost Savings (Internal vs Outsourced Research)
How much did our research efforts allow our internal or partner teams to focus more on other efforts while empowering research grantees to focus on what they do best?
• Opportunity & Risk Quantification
What did our research efforts teach us about potential future research opportunities or related risks?
• Time Savings
How much time did our research efforts save us in terms of broader process refinements or future efficiencies?
• Overall Research Portfolio
How much did our research efforts contribute to our broader overall suite of research outcomes? How can we correlate parallel research efforts against one another to compound our success?
So what’s the point of tracking these types of metrics? What does this bring us?