Thank you to ACCED-I Corporate Member Kinetic Software for contributing as a guest blogger.
Let's face it. Many times, those of us in conference services find ourselves fighting for any number of items: additional staff, software, access to buildings, the right to exist on campus.
There is a way to make your case in an effective way, but what are some tools you can use to justify your purchases?
Note: If you are looking for ways to justify the need for a conference services department, we have two blog posts listing ways to find and measure your impact on your campus.
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How difficult is it to get large ticket purchase requests approved? If your answer is "no sweat", then this post really isn't for you.
Or do you relate more to this? You have put your case together with the most compelling reasons for your purchase request, full of vision and excitement. It is a beautiful story ensured to not leave a dry eye in the room.
Then the response of denied comes back. What? How is this? Can they not see?
Chances are the collective “they” probably can't. While stories are great, numbers speak. Especially numbers with the little dollar sign in front of them. And while you might have had some figures in your request, what exactly did those numbers convey? Cost upfront and over a 3-5-year period?
But what about the money are you watching walk out the door because you do not have the right tools? What is the financial cost of doing nothing and staying with the status quo?
This might speak louder than the purchase price. Let the numbers make the case for you with a Return on Investment (ROI) report.
Why a ROI Report?
Simply put, ROI measures the gain or loss of a purchase relative to the amount of money invested. It means having a deep understanding of the nature of the project and evaluating the difference in time and money.
Now, I'm not going to lie. Creating a ROI report can be complex and time consuming. However, there is a reason you are asking for these funds and walking this path. A complete understanding and evaluation of the current situation is going to be a powerful tool to justify the expenditure.
We have seen ROI reports change a "no" to a "yes". Here are five steps you can take to create your own ROI report to justify your purchase.
Step 1: The End Goal
I know it sounds crazy, but start at the end. To show whyyou need to make the purchase, you need to understand where you want to go. You can then determine the gap between where you are and where you want to be.
So, what are your goals? What is the focus of your department within the institution?
Your focus will usually fall into one of three categories: Growth, Improving Efficiency, or Generating Revenue.
Step 2: Roadblocks
You see the destination, your goal. Now what is keeping you from reaching it? Why are you missing the mark?
While step 1 helps you see where you want to be, step 2 actually identifies those things that are keeping you in place.
For example, let’s say increasing business is an end goal, but no matter what you try, it is looking like you won’t meet that new target. The inquiries are there, but the bottom line isn’t. Why?
Step 3: Tool Shopping
While creating a ROI report can be time consuming, it will take you through all the steps when it comes to the selection process. It will also provide you with a much better grasp of tools you need, as opposed to being drawn in by the shiny wrapper.
Using the goals and roadblocks, you can now research the tools that will help you overcome your roadblocks and help you reach your goals.
Keep in mind, you are searching for a NEW system or tool, not a replacement.
You can find additional resources sharing tips for a successful selection process and making the most out of vendor demos in our Resource Library.
Step 4: Gathering Your Data
This will be the meat of your report that will drive action. When justifying a new purchase, it is imperative to show the reader not just the cost of the purchase, but also how the new tool or solution will ultimately result in a net gain on ROI.
Remember our example about increasing business? You have identified your goals in step 1 and determined a roadblock from step 2 is that you do not have the systems in place to handle larger groups or groups more often (larger groups more often = more revenue).
But how do you show that the tool you have found will make a difference as opposed to staying with the status quo?
Let’s start with what you are doing. What is the value of the business you are currently turning away? How can you show that you are not maximizing your occupancy? What is the dollar value of staff time being spent on manual tasks?
Without a system to automatically produce the numbers, it falls to you to record. Excel will be a great tool to use due to formulas and filtering features.
Step 5: Put it all together
You have the data, now you need to bundle it all together.
Be aware of your audience. Data is king, but the review team may not understand your current situation. You may need to educate them as well.
For a recommended outline of how the ROI report should flow, visit our Resource Library and download our guide on Justifying Your Purchase. It takes a deeper look at each of these steps, providing questions and a report outline.
Ready to build your own ROI Report?
Click Here to download our eGuide to get started.
The key to requesting funds for any new purchase is knowledge. These 5 steps provide you with the foundation to confidentially identify gaps in your current processes and show how new tools will bridge or eliminate the gaps.
If you would like assistance in generating a ROI report for your next purchase, talk with a member of our team at firstname.lastname@example.org.