To innovate and improve business processes sounds logical, right? Of course you can experiment, prototype and try new things, but for the most part, digital innovation is only worthwhile if the work adds greater value to the organization than it costs to undertake. Now that might sound fairly obvious. But you’d be surprised how often this simple rule gets forgotten, or at least how often nobody thinks to set out to prove the point before development begins.
I have been a Mendix consultant for over nine years now and more than once I have bumped into developers proposing or working on projects where no business case or return on investment (ROI) plan has been made.
The importance of projecting a clear Return on Investment
There are two situations I observe that stem from business project proposals that do not have a clear business case with projected ROI figures.
First off, when an innovation is proposed to management without anyone having gone to the trouble of making a value calculation, decision makers tend to only look at the cost of the implementation. Because the benefits of the project will always be uncertain and reliant on somebody’s gut feeling, costs, hassle and risk will inevitably become the deciding factors. Sadly, I have seen numerous ideas and innovations being put aside for just this reason; some of which sounded really good. But the business will never know whether one of those ideas might have been worth a million dollars, because it was shelved as nobody did the math.
Secondly, when a proposal does manage to get the go-ahead despite there being no calculation for projected ROI (say based on trust, gut feeling or just to ‘keep up’ with the times), then it can be difficult to keep a level head on expenditure versus benefit. Some projects sure look rosy in the end and all is good. But others become money pits where there’s no clear line in the sand as to when to throw in the towel and the inevitable outcome is a costly failure.
Observing the above situations, TimeSeries and I decided we could use our expertise to help organizations make better, clearer ROI decisions. Today, we offer two services described below, designed to help you discover new ideas for innovation that add real value.
TimeSeries Innovation Center – Guiding you towards profitable innovation
TimeSeries Innovation Center is a service that helps organizations discover innovations for their particular business and calculate the added value right away. Typically we hold two on-site (or virtual) ideation sessions with you. Having defined a set of possible innovations we then use our business and technology expertise to validate them and suggest their potential value versus cost.
TimeSeries Value Calculator – An online ROI/TCO calculator
While you certainly might like to engage with us through the TimeSeries Innovation Center for a holistic scoping of opportunities, we are also excited to have just launched a simple-to-use online ROI/TCO calculator! The TimeSeries Value Calculator is free to use and will help you estimate the value of your innovation idea in just a few minutes.
At this moment (March 2021), you can calculate the following two options (and we’ll soon be adding many more):
- The likely Total Cost of Ownership of developing your app in a low-code environment versus via traditional coding-based development
- The Return on Investment for our Inclination Test Preparation app for the Marine Industry, which will be explained in further detail in a separate blog.
For now, let’s take a quick look at calculating the Total Cost of Ownership (TCO) of low-code.
A while back Jethro Borsje (our chief technology officer) wrote about calculating the total cost of ownership of low-code investment. The TimeSeries Value Calculator uses many of the calculations he explained in his blog.
Using the calculator is simple. To compare TCO of a low-code app versus the same app developed using traditional code-based techniques, you’ll need to enter the following indicators:
- The initial development cost of a traditional application
- A percentage of maintenance cost for the upcoming years for the application
- A percentage for continued development for the application
- A percentage for infrastructure cost for the application
Once you have done this, you can enter similar indicators for low-code development with a development speed-up factor. We already pre-filled some of the fields for you, based on our years of experience in low-code development. With these indicators set to your situation, you can calculate your TCO of low-code development over the upcoming years.
Of course, we understand that this calculator makes certain generalizations. It cannot account for your specific situation and you might need to make some assumptions. However, it should give you an indication of the cost difference between taking a low-code approach and a traditional code-based one. Within a few months, we hope to add new functionality that will give you much deeper insight around the viability of your app ideas and development approaches. We’ll also add many more of our industry templates to the calculator (beyond the Marine industry template, currently offered).
Fun fact: the calculator itself is built with the low-code development platform Mendix.
I invite you to give the TimeSeries Value Calculator a try and see for yourself the added value of your app idea as a low-code application!
All the best,