Real-world tips for ensuring digital ROI

Digital transformations are struggling to produce value, delivering less profit than expected, thanks to several pitfalls unique to the digital journey and an inability to pivot midstride.

Real-world tips for ensuring digital ROI
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Hindsight may be 20/20, but so is knowing when to cut your losses before investing too much money, time and effort on a project that won’t achieve the desired ROI.

That’s what Toronto-based real estate services and investment management firm Collier International has learned. Rather than committing to new projects based on traditional requirements gathering and early estimations, the global IT group starts with short sprints designed to validate a business idea, the technical solution and the potential business benefits, says Mihai Strusievici, vice president of global IT.

“The incremental sprints approach provides cost certainty and a go/no-go decision point between sprints,’’ he says. “This way, the development team learns as it goes at a known burn rate and has the opportunity to stop before too much effort is spent on something potentially not useful.”

With the pressure on organizations to roll out digital initiatives quickly, it’s not surprising that sometimes progress gets stalled and outcomes don’t meet expectations. Even when IT leaders have estimated and measured what ROI should come from a project, often they have to pivot and make changes to maximize their investment.

The average digital transformation stands a 45 percent chance of delivering less profit than expected, while the likelihood of surpassing profit expectations, on average, is just one in 10, according to McKinsey.

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