Building out an intranet solution such as SharePoint, or a larger digital workplace initiative, can be a significant investment. For those types of expenses, organizational leaders usually require a business case before committing to the budget.

Let’s look together at some different approaches for your digital workplace business case, and a few examples that you can use in your organization.

Getting Started with a SharePoint Business Case

The best place to get started with your thinking about a business case for your SharePoint (or other Intranet/Digital Workplace) project is close to home.  Think through the following questions and do your homework:

• Internal Templates: Does your organization have a standard accepted format for a business case? Use that. If not, find out what business cases have been successfully approved and borrow as much as you can from those.
• Top Priorities: What are the top priorities for your organization in the coming year? What is the stated mission of your business? What are its values? Connect your business case to all of these items to clearly show the link between who you are as a business, and where a digital workplace investment can help you to become better in those areas.

In other words, listen to and understand your audience before you get started. Different people respond to different approaches, and you want to know what will work with your leadership team.

Qualitative Intranet Business Case

When considering the business case, keep in mind that many of the benefits of an intranet are extremely difficult to quantify. And even some seemingly quantifiable metrics are almost impossible to actually measure.

Consider how you might quantify these benefits:

• Survival: Businesses everywhere are being disrupted by more digitally-savvy rivals. Failing to keep up may eventually mean extinction.
• Communication and Knowledge: Core to an intranet is better internal communications of all types: top-down, bottom-up, and side-to-side. Also core is access and retention of corporate knowledge. The impact of one message that better aligns the team, or one data point that averts a major crisis, can be difficult to quantify.
• Culture: More and more organizations are viewing their intranets as a core part of creating a better culture. Some companies have proven this out by measuring awareness and alignment around core company values and how their digital workplace impacts this. Culture, almost by definition, is an unquantifiable outcome.
• Physical Workplace: A digital workplace is a lot like a physical workplace. We don’t question the need for a physical workplace. Many companies restructure offices into more open spaces to break down silos and change the way people think about working together. Those initiatives are difficult to quantify – but they are clearly important. The same is now true of our digital workplaces – if people don’t have a suitable place to work together digitally, a company will not remain competitive for long. 

Just because these items cannot be easily measured does not mean that they should not be a part of your business case. Your business case should include both qualitative and quantitative project justifications – and the qualitative area may, in fact, be the more important of the two.

SharePoint and Digital Workplace ROI Metrics

There are many ways to estimate the ROI of an intranet project.  Here are a few thoughts and metrics to get you started.

• Workload Analysis: Can you find one process that you can quantify an improvement around? The metrics below may help, but a better approach would be to look closely at your own processes. Ask people what problems they struggle with, what processes take a long time, where does information seem to be more difficult to find, etc. Estimate how much time you can save and quantify that.
• Four Pillars: Familiarize yourself with the 4-pillars of intranet and digital workplace projects. These pillars are at the core of the benefits a team attains.
• Third Party Metrics: There is a wealth of research you can find on the web. Use these metrics to add validity to your calculations.  Click here to download digital workplace and intranet ROI metrics that you can build into your business case (along with source references).
• Be Careful About Efficiency Metrics: Some executives will view efficiency metrics as a cost-cutting metric (i.e. “if we improve efficiency, then we can downsize employees to save cost.”). In some cases, that may be an unfortunate part of the calculation. In most cases, however, a digital workplace should free people up to do more valuable things that ultimately create better customer experiences and improve revenue. Be ready with an answer if someone asks if your business case involves reducing headcount and, if not, tell them why.

Connect the Dots

In most cases, it’s not enough to say “we will recover 10% of the hours spent searching for documents.”  You’ll need to quantify those numbers into real figures for the leadership team.  Here are a few examples.

• Time savings
  • We spend an average of 37 hours developing each new proposal, with a total of 173 proposals last year – that’s a total of 6401 hours. By finding information faster, and more easily collaborating on proposal drafting, we can save 10% of that time, or 640 hours per year (about 33% of a full time job).  That time can be used to write 19 more proposals without adding new costs.  Each proposal proposal generates an average of $3,318 in new revenue – for an annual improvement of $63,042. Or, that time can be spent on better training, and research & development.
• Crisis mitigation
  • Last year, a crisis cost us (or our competitors) over $250,000 in penalties and lost business. By better sharing knowledge and engaging our team in conversations, we can mitigate a crisis of that type at least once every 5 years for a benefit of $50,000 per year.
• General numbers
  • Research from MIT reports that highly connected colleagues generate an average of $83,000 more in annual revenue than others. Our organization is highly siloed. By encouraging digital connections, and improving 5% of our 873 people’s connections and receiving only 5% of the $83,000 for each of those people, we anticipate an annual revenue benefit of $181,147 each year.
  • New employees are being attracted to companies with technology that is as sophisticated as what they are already using on their mobile phones and laptops. If we retain just 1 more employee per year, it will eliminate a recruiting and training cost of approximately $12,500 each year.
• Add it up and cross-validate it
  • Overall, we anticipate an annual return of $306,689 with the upgrade paying for itself within 9 months.
  • These numbers align with third party case study research showing an average of a 5-17 month break-even.

Tell Stories

Remember to use creative story telling where appropriate – in many organizations a few good stories wins out over 100 valid metrics.

Stories can come from your people (“Jill in finance tells us that she spends at least 9 hours every day looking for documents”), case studies (attend events and talk about the benefits other companies achieved), analogies, or from third parties (here’s a story on digital disruption that I linked to earlier as an example).

Bring it All Together

Your business case should bring all of the above together into one succinct presentation.

• Listen to your audience first
• Understand what’s important to them and what they’ve responded positively to in the past
• Connect the information so they will…
• Know what kinds of results to expect

Qualify, quantify, calculate, align with values and priorities, and tell memorable stories.

Need help getting buy-in from organizational leaders? Click here to contact C5 Insight to chat about your intranet and digital workplace business case needs.