Every single organization wants to generate high revenue and increase their profits repectively in the long term. If a company is running its business from spending money on goods so they can produce other goods to tailor fit their needs, they would want to know what they are gaining from producing these goods and services. Thus, they are making an investment to produce these goods in order to receive a greater return from what they invested. This is how the term “Return on Investment” was coined. According to Entrepreneur (2012), ROI deals with the money you invest in the company and the return you realize on that money based on the net profit of the business.
Today’s topic will discuss concepts introduced on the importance of ROI in regards to companies within the Computer Science field and the new methods of calculating it. To calculate ROI, the benefit (return) of an investment is divided by the cost of the investment; the result is expressed as a percentage (Investopedia, 2012).
Organisations in our time, have learnt that imlementing an Enterprise 2.0 strategy comes with benefits and risks. Additionally, these organisations also know that using the strategies to benefit their firms and avoiding risks can assist greatly in yielding higher revenues. For example, implementing new IT infrastructure within a workplace can cut the necessity of an employee or many employees while increasing productivity and efficiency in the workplace simultaneously. Some new methods to increase ROI in business will be listed below. Organizations can create new methods to engage employees, and provide accurate feedback to employees and reducing the rate in which employees leave or join the workforces. Moreover, organizations will aid in the reduction of search time or use of search strategies by utilizing social media tools as a competitive advantage.
- Employee turnover is the ratio of employees a company loses to the average number of total employees (Wisegeek, 2012).High employee turnovers can cost organizations twice the price of finding and training replacements. Therefore, creating a subsidiary or a different network to attract new employees is essential in case there was an increase in employee turnover. Utilizing social media for these networks will help speed up the process in general. Nevertheless, reducing employee turnover is another method of generating a higher ROI.
- Employee engagement can greatly beneift and improve organisations’ methods of collaborating. Employees utilizing social media tools to collaborate are more engaged they are moving towards the future of Web 2.0 in which collaboration is enhanced through social media tools. The lack of collaboration between employees is a challenge faced by many organizations. Nevertheless, Implementing, training and guiding employees on how to use social media tools to simplify collaboration methods is a great step for companies. If organizations can familarize themselves with such factors, these same factors wont be a hinderance on their ROIs.
- Decreasing Searching Time can be achieved through the use of blogs, wikis and other social media tools such as Twitter. Although Twitter may not seem like a professional tool for collaborating and rather more social, companies can encourage their employees to use a hashtag function which will focus their updates towards other members of the company. Rather than dealing with asking other employees for certain documents or going across departments to retrieve certain files, information can reduce such time-consuming tasks and information can be updated continiously online.