Finding the Right Formula for ROI
- Published: Thursday, 16 June 2016 17:03
In the last issue we discussed the issues with the ‘time is money’ approach to a return on investment analysis. Now let’s turn to a better, but still flawed version: Time saved = time to reallocate = money. This is possibly true. As we saw above, reallocating time saved to reducing stress and errors can be a valid – albeit soft – ROI.
If the time is reallocated to income producing events (i.e. med reviews) then the value is the net income from the new event. If, however, the time is reallocated to cleaning and tidying the dispensary, or filing paperwork, then the value will be difficult to determine and will be a very soft ROI indeed.