How to Quantify the Return on Investment of Library
Technology Projects
Alice Swabey, Coordinator - Access Services, Mount Royal University Library
Jeff Narver, Library Productivity Specialist, 3M Canada Library Systems
What this Process is … and isn’tForecastProcess not a toolNot to prove Gap analysisNot for all projects
Why Use Project ROI?Reduce risk Resource allocationDefining a balanced value perspective
Qualitative, quantitative, strategic, tactical, short & long term
Funding toolValidate claims
Step 1: Environmental Scan
Collect & evaluate potential projects Prioritize projects Organize the team Library circumstances
Step 2: Program AssumptionsOutline of problem
Possible solutionsPossible alternatives
Go / no go’sProgram parameters
Size & scopeGut check
Step 3: Program Objectives
Simple, measureable, realisticFinancial, time, learning
Benchmarking
Step 4: Identify Impact Points
Break down current processBreak down new processIdentify and compile master list
RFID Sample Impact Points Speed of circulationShelf management New materials processingReduction in materials handlingSpeed to shelf
Step 5: Conversion Standard
What standard will you use?If it doesn’t fit, don’t force it
For example ...
79 652 circs/yr x 7.5 seconds/item = 165 hours x 28.98/hr wages = $4781
Step 6: Data Collection
Review impact pointsCollect data
Observation InterviewsTiming SurveysBenchmarkingSecondary sourcesTestsSubject matter experts
Data examplesHard SoftCirculationLost itemsDiscrepanciesSalariesCustomer complaintsStaff turnoverEfficiencyProcessing time
Process improvementLeadershipReputationCustomer loyaltyCustomer complaints &
impressionsStaff complaintsStaff satisfactionStaff Safety
Then Estimate Change
Agree upon change estimatesDon’t force it (step 8)
Project Savings Area of Impact
Speed of check-in -- $$
Inventory -- $$
Shelf Reading -- $$
New Collection Processing -- $$
Circulation Desk Staffing -- $$
Total Year One Savings -- $$
Step 7: Project CostsIt isn’t the just the equipmentCapital vs operational1 year or 3-5 years
Sample Project Costs
Planning and Meeting Time 20 hrs @ $40.32/hr
RFID Research 20 hrs @ $40.32/hr
Vendor Evaluation 25 hrs @ $40.32/hr
Trades Work & Renovations TBD
Hiring & Training Tagging Crew 10 hrs @ $13.50/hr
Tagging Time * 558 hrs @ $13.50/hr
Conversion Station Rental 3 months @ $1,100.00
Supervising Tagging Crew 10 hrs@ $28.98/hr
Staff RFID Systems Training 42 hrs @ $24.20/hr
Policy Review and Revisions 20 hrs @ $28.98/hr
Internal and External Communication 10 hrs @ $40.32/hr
Customer Training 30 hrs @ $28.98/hr
RFID Tags and Equipment TBD
SIPS License 1
Qualitative factors drive projects
Intangibles are the invisible advantage
Jack Phillips, 2007
Step 8: Qualitative BenefitsHelp tell the storyCustomer satisfactionStaff satisfaction
Step 9: Return on Investment
Calculate the annual project benefits (step 6)
Divide them by the project costs Payback
average 3-7 years
Step 10: Writing the Report
Barriers & enablers to implementation
Step 10: Write Report
Know your audience
Step 11: Do follow-up
Test assumptions after project implementation
What we learnedListen to the dataTimeManage staff anxietyIt isn’t always the quantitativeProcess milestones & credibilityLearning about your library
Adding it all up...
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