Building a business case without proving Return on Investment (ROI) is like trying to sell a car without showing the mileage. Stakeholders need assurance that your project will generate measurable value so demonstrating ROI doesn’t just strengthen your case - it builds trust, reduces decision-making uncertainty, and increases your likelihood of securing approval.
A strong ROI narrative is particularly important when resources are limited, and leadership is weighing multiple initiatives. Projects with a clear, quantifiable return naturally rise to the top of the priority list. In the fifth tutorial in the Business Case Academy, we explore why ROI matters, how to calculate it accurately, and how to present it effectively to win support for your business case.
Why proving ROI matters
Return on Investment (ROI) measures the financial benefits your project will deliver relative to its cost. While qualitative benefits like improved customer satisfaction or brand reputation are valuable, decision-makers often prioritize projects with clear, quantifiable returns. When you demonstrate ROI effectively, you:
🛡️ Build credibility
Solid numbers show you’ve done your homework and understand the financial implications. Stakeholders are much more likely to trust proposals that present clear data and justify their claims.
🥇🥈🥉 Align with stakeholder priorities
Financial leaders, in particular, are more likely to champion initiatives with clear financial payback. A strong ROI highlights that your project contributes to the company’s fiscal success.
⏱️ Accelerate approvals
Decision-makers move faster on proposals that provide clear evidence of value therefore presenting ROI upfront will help reduce hesitation and uncertainty.
💪 Strengthen accountability
A well-defined ROI sets performance expectations and provides benchmarks for measuring success, as well as establishing a starting point for tracking value realization over time, which is a fundamental aspect of the KangaROI approach.
In competitive budget discussions, a project without a clear ROI can struggle to gain traction as decision-makers will prioritize investments that demonstrate a tangible return. Even qualitative benefits, when translated into financial impact, strengthen your case.
💡 Tip: Stakeholders may wish to challenge your ROI assumptions so be prepared to show your inputs into KangaROI that fed into your ROI calculation in the Appendix. This is a key reason for handing your calculations off to a bespoke ROI platform, as it removes any suspicions of formulas being manipulated or tweaked in spreadsheets to present a more positive outlook, instead adding accountability, transparency, and credibility to your calculations.
How to calculate ROI
ℹ️ For a deep dive on this topic, read our handy guide - What is Return on Investment (ROI)?
Calculating ROI is about more than just plugging numbers into a formula. Thoughtful ROI forecasting involves identifying the right metrics, gathering accurate data, and ensuring your projections are both realistic and defensible.
The basic ROI formula is:
ROI (%) = ( Net Profit / Cost of Investment ) × 100
where:
Net Profit = Total Revenue - Total Investment
Cost of Investment = The amount spent on the investment
1️⃣ Identify your costs
Direct costs - include project expenses like software, equipment, and contractor fees. These are typically the most visible and easiest to quantify.
Indirect costs - capture internal labor, training, and operational adjustments.
Ongoing costs - consider any recurring expenses like subscriptions, maintenance, or support.
2️⃣ Estimate your benefits
Revenue generation - will the project directly increase sales or unlock new revenue streams? Projects that expand market share or improve customer retention often have strong financial benefits.
Cost savings - will it reduce labor hours, eliminate inefficiencies, or cut operational costs? Process improvements, automation, and error reduction often result in measurable savings.
Risk mitigation - quantify the financial impact of reducing business risks. For example, cybersecurity improvements can prevent costly data breaches.
3️⃣ Determine the timeframe
Short-term ROI - Focus on the immediate payback period (often within a year). Some stakeholders may prioritize projects with quick returns.
Long-term ROI - Consider the cumulative benefits over the project’s lifecycle. Long-term gains can justify larger upfront investments.
💡 Tip: Present scenario modeling to show your project's resilience under different potential outcomes, e.g. modeling best-case, worst-case, and realistic scenarios. This helps stakeholders understand the range of possible outcomes and builds confidence in your assumptions.
Presenting ROI effectively
Once you've calculated ROI, the next step is to present it in a way that resonates with stakeholders. Clear, concise visuals and scenario comparisons can make your ROI story far more persuasive.
📰 Lead with the headline
Start with the key takeaway; if your project is forecasted to deliver a 150% ROI in two years, make that clear upfront.
👉 e.g. “This initiative is expected to generate $5M in cost savings over three years, delivering an ROI of 180%.”
📝 Provide context
Explain the assumptions behind your ROI calculation. Highlight how external factors like market conditions or internal process improvements support your projections.
👉 e.g. “Our analysis assumes a conservative 10% increase in productivity and a 5% reduction in operational expenses, based on recent similar projects.”
Additionally, providing transparency on data sources and calculation methodologies will increase stakeholder confidence.
🖼️ Visualize the impact
Graphs, charts, and tables can bring your ROI narrative to life. A simple side-by-side comparison of costs versus benefits over time often makes a powerful statement.
👉 e.g. Consider a cumulative cash flow chart showing the breakeven point and when positive returns will begin.
Using visuals that display ROI across different scenarios can further emphasize your project’s potential resilience.
🤔 Address stakeholder concerns
Anticipate potential questions by offering alternative scenarios or demonstrating how risks will be mitigated.
👉 e.g. “In a lower-growth scenario, we still project a positive ROI within 18 months, with a reduced payback period.”
Stakeholders are more likely to support your proposal when they see you’ve accounted for uncertainty.
How KangaROI makes this easier
Rather than relying on a plethora of spreadsheets that require manual calculations and frequent updates, KangaROI streamlines ROI analysis with automated calculations and built-in scenario modeling.
❌ 𝄜 Beyond spreadsheets
KangaROI eliminates human errors common in manual calculations, ensuring greater accuracy and consistency across your whole org when calculating and presenting ROI.
🎚️🎚️🎚️ Intuitive controls
With easy-to-use sliders, you can adjust key variables like inflation, your org’s discount rate, and project length in real time, seeing immediate updates to your ROI projections.
🅰️ / 🅱️ /❓ Built-in scenario modeling
Instantly compare best-case, worst-case, and likely-case scenarios as well as different providers, different timelines, different product launches etc without the hassle of building complex spreadsheet models. This helps stakeholders analyze and visualize different risk and return scenarios effortlessly.
ℹ️ For more information about Scenarios, please see our blog post announcing it.
By simplifying calculations and making scenario comparisons seamless, KangaROI helps you build a more persuasive, data-driven business case that accelerates approvals and secures stakeholder confidence.
Summary
Proving ROI is one of the most effective ways to secure stakeholder buy-in. A strong ROI calculation not only validates your proposal’s value but also builds confidence in your ability to deliver results.
Next time you’re building a business case, ensure ROI isn’t just an afterthought - make it the foundation of your story. Clear projections, transparent assumptions, and visual impact will elevate your case and set it apart from competing proposals.
