What is ROI in project management?
Return on Investment (ROI) is a financial metric that expresses the net benefit of a project as a percentage of its total cost. The standard formula is:
ROI = ((Net Benefit − Investment Cost) ÷ Investment Cost) × 100
ROI is useful for comparing projects during investment appraisal and for communicating financial returns to senior stakeholders and finance teams. Its limitation is that it is a snapshot metric and does not track whether benefits were actually delivered, or when.
What is benefits realisation management?
Benefits realisation management (BRM) is the process of identifying, planning, measuring, and sustaining the intended benefits from a project or programme across its full lifecycle. Unlike ROI, which is calculated once, BRM is an ongoing discipline that continues after project delivery to confirm that the business is actually capturing the value it invested in.
BRM addresses questions ROI cannot: Are the benefits on track? Who is accountable for delivering them? What needs to change if benefits are not materialising as planned?