Assessing the return on investment (ROI) of any solution is a best business practice and doing so for your strategy execution software is no different. Many organizations use this technology to improve operations and decision-making. However, accurately determining ROI involves understanding both tangible and intangible benefits.
This post will explain the important factors needed to evaluate the impact of your strategy execution software, helping to ensure that your investment supports effective strategy execution and aligns with your long-term strategic goals.
Why Investing in Strategy Execution Software is Worth It
67% of well-formulated strategies fail because of poor execution. This statistic demonstrates the benefits of investing in strategy execution software, especially for improving ROI through better strategic alignment and operational efficiency. Such software helps you visualize your strategy, linking departmental projects and key performance indicators (KPIs) to your organization’s main goals. This ability clarifies how each part contributes to larger objectives and highlights key areas critical to your success.
With a system like ClearPoint, organizing your data becomes simple. You can automatically integrate strategy data from different sources. This ability eliminates manual data collection and allows you to create customized dashboards and reports offering qualitative and quantitative analysis.
ClearPoint also simplifies the business reporting process. It automates routine tasks like update notifications and report generation, reducing administrative tasks and the need for extensive manpower. This frees up staff to focus on more important activities and improves the agility of your strategy execution.
To understand more about the value of such software, beyond just the cost considerations, read our post:
How to Calculate the ROI of Strategy Execution Software
Calculating strategy execution software's ROI is essential to see how it can benefit your business. We will explain how to measure time savings, evaluate decision-making improvements, and check overall efficiency. These steps will help you understand the substantial ROI of your strategy execution software, demonstrating its ability to save costs and enhance strategic operations that drive organizational success.
- Define Clear Objectives
Begin by setting clear, measurable goals that align with your organization’s needs. These goals should be specific, measurable, achievable, relevant, and timely. This process is known as setting SMART goals. You can find a full guide to SMART goals here. Establishing these objectives at the start of your project guides the software implementation and sets specific criteria for measuring its effectiveness.
By defining what success looks like for your strategic goals, you can link the software’s performance directly to improved organizational outcomes, allowing for a solid evaluation of ROI.
Want to master the transition from plans to execution? Read our beginner's guide to strategy execution.
- Measure Baseline Performance
You must first set a baseline performance for each identified measurable goal. Take these initial measurements before implementing the software to establish a clear benchmark for comparing future performance improvements.
For example, if one of your goals is to reduce the time it takes to generate reports, you would record the current average time spent on this task across different departments. This initial data serves as your benchmark, allowing you to compare it against the performance after the software is implemented to clearly see any improvements in efficiency.
- Calculate the Costs
To accurately calculate the ROI of your strategy execution software, start by tallying all related costs. Begin with the initial purchase price, which is your main financial outlay. Include implementation costs, software customization, and integration into your existing systems. Also, account for the costs of training your employees to use the software effectively, as their proficiency is key to leveraging its full benefits.
By adding up initial and ongoing expenses, you establish a financial baseline against which to compare the software's benefits. Book a demo with our strategy experts and find out how ClearPoint Strategy provides one of the most cost-effective solutions on the market.
- Analyze the Data
To accurately calculate the ROI of your strategy execution software, analyze and compare the post-implementation data to your initial baseline metrics. Focus on measuring improvements in operational efficiency and strategic alignment.
For instance, calculate the cost savings if the software has reduced the time needed for report generation. If we consider the average hourly rate for team members, the cost for generating reports has substantially dropped. The savings from this reduced time accumulate each week, leading to significant annual savings, clearly demonstrating the financial benefit of the software investment.
- Consider Intangible Benefits
It's important to consider the intangible benefits that, though harder to quantify, significantly enhance the value of your investment. These benefits include improved employee satisfaction due to spending less time on repetitive tasks and more on strategic initiatives. You can measure this by doing an employee satisfaction survey. Another key intangible benefit is better strategic alignment and transparency, as the software ensures that all teams in the organization are working toward the same goals.
While these advantages may not immediately translate into financial gains, they contribute to a more dynamic, engaged, and aligned workforce. Including these intangible benefits in your ROI analysis offers a fuller picture of the strategy execution software's true value. They’re definitely worth mentioning in a presentation or report for stakeholders.
- Review and Adjust
Calculating the ROI of your strategy execution software is an ongoing task that needs regular monitoring and updates. As your organization grows and the use of the software increases, its impact on your strategic goals might change. It's important to review and update your ROI calculations frequently to reflect changes. These changes could be in software use, operational shifts, and changing strategic objectives.
Regularly updating your ROI analysis supports a proactive approach to strategic management, helping to ensure that your investment remains aligned with your organization's long-term goals.
- Stakeholder Feedback
This feedback offers valuable qualitative insights that enhance the quantitative data you've already collected. Make sure to engage with various stakeholders, from frontline employees to top management, to get their views on the software's effectiveness, and usability. You should also ask about its impact on their daily tasks and strategic objectives.
This approach highlights areas for improvement and showcases the software's successes and its role in meeting organizational goals. By understanding the experiences of your stakeholders, you can more accurately gauge the software’s overall value and effectiveness.
There are plenty of examples of effective strategy execution. Learn from these five organizations that have done it well.
Calculate the ROI possible with ClearPoint Strategy
Beyond ROI: Other KPIs That Measure The Impact of Strategy Execution Software
As we previously mentioned, it is important to consider intangible KPIs. While ROI is a key indicator of your strategy execution software's financial impact, other important KPIs also help evaluate its wider effects on your organization. Some examples of these KPIs include:
- User Adoption Rates: Measures the extent and effectiveness of software use within your organization. High adoption rates usually indicate a successful implementation and high user satisfaction. To calculate user adoption, divide the total number of new active users by the total sign-ups and multiply by 100.
- Operational Efficiency Gains: Tracks improvements in the speed of processes and the time needed to complete strategic tasks, reflecting the software's ability to simplify complex operations.
- Strategic Goal Achievement Rate: Monitors how well and quickly strategic goals are achieved after the software is implemented, helping to determine whether the software effectively supports key business objectives. Show your progress toward your goals using charts and graphs as a visual aid.
- Employee Engagement and Satisfaction: Though more subjective, changes in employee engagement and satisfaction post-implementation can show how the software has made work processes easier and more meaningful.
By tracking these KPIs along with ROI, organizations can get a full picture of the value provided by strategy execution software, covering both financial and operational aspects. Take a look at the challenges and successes teams have experienced: Watch our strategy execution recap.
How ClearPoint Strategy Simplifies Strategy Execution
ClearPoint Strategy simplifies strategy execution by turning complex, manual operations into streamlined, automated workflows. This platform is designed to improve the accuracy and speed of your strategic initiatives.
ClearPoint Strategy utilizes artificial intelligence (AI) and advanced technologies to simplify strategic planning and turn complex data into clear insights. This technology supports smarter decision-making, simplifies complex processes, and enhances organizational agility for organizations looking to improve their strategy execution.
Start transforming your strategy execution with ClearPoint Strategy. Visit our website or contact us today to learn more and book a demo.
