How Do You Measure Your Software ROI? (And Other Questions About Choosing SaaS Products and Salesforce Implementation Partners)

If you’re a solopreneur or own a small-to-medium sized business (SMB), you might be the primary or one of only a few decision makers when it comes to significant purchases. Oftentimes, though, the main advocate for a new software solution must get buy-in from others before making such an investment. 

To use finance as an example—because that’s what we at IvyTek do—perhaps you’re a business development professional for a regional retail chain’s new in-house lending division. You recognize that the current process is a little clunky and disjointed and know that an end-to-end retail financing software product would not only make your life easier, but also provide a better experience for your customers and even other departments at your company. You also know it will help the company save money in the long run. But, others don’t know all this, yet.

Getting buy-in from the key decision makers, such as a CFO or a board of trustees, can be challenging; that’s where effectively making your case comes in. A big part of that—perhaps the most important part—is showing the return on investment, or ROI. In this blog post, we’ll cover some important things to consider when purchasing software, choosing an implementation partner, and rolling out and managing the product. 

What is ROI & Why Does it Matter

ROI is, among other performance metrics, a formula used to guide business decisions, such as exploring the value of implementing a new customer relationship management tool, marketing automation solution, or loan management system. Aside from determining if a specific product is a worthwhile investment, calculating ROI for an IT project can also help you more accurately compare several vendors and products.

You’re likely familiar with ROI, but we’ll provide a business school recap for you: 

ROI = (Gain of Investment) – (Cost of Investment) / (Cost of Investment)

Regardless of industry or size, there are standard factors and questions businesses typically consider when evaluating ROI. These usually revolve around boosting revenue or maximizing profitability, such as “how will being more efficient contribute to cost savings?” or “will implementing a robust new system reduce redundancies and, therefore, cut other software expenses?”  

(Hint: If you don’t have one in-house, you could find software ROI calculators and general ROI templates online from a variety of sources, such as this one from SmartSheet.)

Considerations When Choosing Software: ROI & More 

As with any investment, it’s crucial to look beyond the initial purchase price (or fixed monthly rate). As you explore software for loan management, learning management, lead management, or anything else, keep in mind there will almost always be additional expenses—short- and long-term—based on your needs, whether within the software itself or your internal team’s capabilities and bandwidth. 

As you work on how to measure your software ROI and, ultimately build the case for your proposed project, here are some factors to consider:

• Functionality – does this product have what you need? Conversely, if it has more than you need, are you able to purchase/subscribe to only the modules you need? Thinking deeper, how might the features and functionality of this product reduce cost (and time) elsewhere?
• Flexibility – is the product customizable? Adaptable? Can you create different permission levels based on user types? Will a software product with broader capabilities help increase revenue or decrease overhead in other areas?
• Usability – is it user-friendly for both your clients and relevant internal users? Does it meet accessibility standards? Is the user experience seamless on all devices? Consider how a system with better UX might help retain more customers or boost revenue. Conversely, think about the legal ramifications of using a platform with accessibility issues.
• Delivery – is this product cloud-based (SaaS) or will it be hosted at your location? Independent of price, which is the best choice for your company and clients?
• Scalability – how will this product serve your company as it grows? As your industry evolves? As your services expand? As your customer needs change? How is this software vendor planning to evolve in its own industry space? Think about how the answers to these questions will impact your longer-term finances.
• Compatibility – does this software product offer easy integration with other programs and platforms you use, such as your CRM, marketing automation, or industry-specific tools? If not, consider how you might incur development costs for special customizations and integrations.
• Updatability – it’s also important to consider how your potential vendor/product handles software updates; typically in the SaaS world, general updates (and fixes) would come standard to you as a current customer/subscriber.
• Security – does this product offer the required security levels for your industry and customer expectations? (This is especially critical in the finance world, such as with loan origination software) Are the security features customizable based on user types/customer needs? Think about the financial and (reputational) risks of NOT partnering with a product that complies with security regulations.
• Support – what is the live support like from this software vendor? (While 24/7 isn’t always necessary, is it available during the times you think you’d need it most?) What do reviews say about response time and satisfactory services/successful resolutions? Is there a self-serve knowledge-base and/or user community? How does access to quality support factor into your budget, such as reduced expenses or increased productivity?
• Training – does this software company offer training to new clients? What about ongoing training for new product features and training opportunities employees onboarded after the initial implementation. How might this impact ROI? 

To elaborate on the compatibility and integrations bullet, we’ll share an example. Our product, IvyTek Finance is part of the Salesforce AppExchange. Many companies that use Salesforce as a CRM or other areas of the Salesforce Cloud will often look to the AppExchange for preferred partners—for whatever solution they might need—because there’s so many advantages to using a product built to work seamlessly with a large, powerful system you might already be using. 

A Few Other Software ROI Considerations

Aside from costs specific to the software vendor/product, you might also have to account for purchasing or upgrading hardware, configuring/reconfiguring workspaces, payroll or professional development (ex: hiring new employees or providing additional training to current staff), and even external marketing and communication costs related to education and awareness of the new systems. 

As you can see, it’s a good exercise to look at all the features and benefits of product through an ROI lens when beginning an IT project or, in general, shopping for software.

Considerations When Choosing Salesforce Consulting & Implementation Partners

As alluded to earlier in the flexibility and scalability bullets, companies will often partner with a software consultant for implementation, especially for larger-scale or highly customized IT projects. So, another factor you might wish to add to your software ROI equation is the value of working with an experienced partner. 

It goes without saying you’ll want to find someone with expertise in not only your niche, but also with any larger system you might be using. For example, as mentioned earlier in this post, IvyTek Finance is built on the powerful Salesforce Cloud. In addition to our decades of experience in the fintech industry, we’re also Salesforce savvy. As certified Salesforce consultants, we can guide our clients through integrating their lending software with their CRM. 

Other things relevant to ROI (and risk mitigation) that you should look at when choosing a software consultant include its client roster and/or current client testimonials/case studies.

Software & ROI: Wrapping Things Up

It’s worth noting that, while ROI is ultimately numeric in nature, many of the above factors could also be measured quantitatively. For example, with more efficient processes, some of your most skilled employees might be able to use their time and talents in other, more meaningful ways, and this can improve morale. While not easy to quantify, these valid points are certainly worth considering and sharing with key stakeholders. 

Finally, as you think about the ROI of a software project, consider the costs of NOT switching to this new system. Showing this scenario can be extremely effective in building value and making your case in a compellingly persuasive manner. 

IvyTek Finance is proud to support clients in industries such as education, retail, and community development—and your ROI is important to us. We’d love to share more about what we do and how we help lenders build and manage their loan management software solutions. Call us for a free demo today. 

Further reading about Software ROI:

• Trailhead, Salesforce’s learning platform, offers a guide called “Find Success With Your Implementation Partner.”

IvyTek Finance can help you evaluate the ROI of your software and better understand how customized solutions can increase your ROI profitability.  We’ll give you a better view of how to get the most of your ROI investment when you schedule a free, 10-minute demo.