It’s a story that anyone who’s been involved in a decent number of projects will be familiar with; throughout all the planning, modeling, and forecasting, on paper, the numbers look great, the ROI is strong, the cost-benefit ratio is healthy, and the payback period is short. Then we fast-forward 12 months and the reality is… underwhelming.
With the odd exception, it’s not that people are faking the numbers, it’s just that the system rewards optimistic projections, doesn’t stress-test them, and rarely goes back to see if they came true.
Today we’ll explore the main reasons why ROI forecasts often miss the mark, and also what business case writers and approvers can do to bring forecasts closer to reality.
ROI forecasts are often overly optimistic
When you’re pitching a project it’s human nature to want to paint it in as good a light as possible, as no one wants to think they’re wasting their time working on something that is ultimately fairly pointless, so it’s tempting to present the most optimistic version of the future. As a result, many business cases rely on a single-point estimate for ROI that assumes everything will go smoothly, i.e. immediate cost savings, seamless change etc. However the reality is rarely so cooperative; projects stall, benefits arrive later than expected, and teams often underestimate the drag of process complexity or organizational resistance.
The result of this are business cases that promise outsized returns, but underdeliver once the project is in motion. In fact, even well-intentioned forecasts can fall into this trap when risk, variability, and trade-offs aren’t explicitly accounted for.
So what can we do?
Rather than presenting a single ROI estimate, instead use scenario modeling to present a range of outcomes, i.e. a best case (e.g. 150% ROI), likely case (90%), and downside case (30%). Make your assumptions visible and stress-tested. For example:
Scenario | Assumptions | Forecasted ROI |
|---|---|---|
Best case | Full user adoption in 3 months; support costs drop 30% | 150% |
Likely case | 80% adoption; support costs drop 20% | 90% |
Downside case | 50% adoption; higher-than-expected training costs | 30% |
How can KangaROI help?
KangaROI enables dynamic scenario modeling directly in your business case. Build new scenarios by duplicating and then editing existing ones to maintain consistency across your models while saving time, then instantly see the impact on ROI to give stakeholders a transparent view of both risk and upside potential.
Most forecasts ignore the impact of adoption risk
On a similar theme to scenario modeling, many ROI models assume a perfect transition; users embrace the new system, processes are followed exactly as planned, and productivity gains show up immediately. However, although that’s lovely on paper, in reality, adoption is rarely automatic; teams resist change, usage rates lag and new behaviors take time to embed.
Yet few business cases model what happens if adoption is partial or slow and that’s a major blind spot, especially for projects where value depends entirely on usage.
So what can we do?
Build adoption assumptions into your ROI logic. Model what different levels of adoption would mean for value capture, and connect this to your rollout plan. Not only does this make your forecast more credible, it shows that you’re planning for change, not just hoping for it.
How can KangaROI help?
As well as scenario modeling, KangaROI also lets you ramp benefits over time as they are delivered in the real world, rather than just assuming they will all be delivered in one neat lump. You can model low, mid, and high-adoption scenarios and automatically adjust projected ROI, bringing realism into the business case and surfacing where change management needs to focus.
ROI is treated as a one-time estimate
In far too many organizations, the ROI figure is used to secure funding…and then promptly forgotten. There's little to no follow-up after delivery to validate whether those promised returns were actually realized and without that follow-through, good forecasts can’t be proven right, and bad ones are never corrected. Even more dangerous for an organization is the fact that this develops a culture of overpromising with no accountability for delivery.
If ROI becomes just another slide in a pitch deck instead of a thread through the entire project lifecycle, you miss the opportunity to measure what worked, identify what didn’t, and build on learnings for future projects or investments.
So what can we do?
It feels almost too obvious to say, and yet the fact most businesses don’t do this as a matter of course means that somehow it does need saying: build post-approval ROI tracking into your business case from the very start. What that means in effect is defining clear success metrics, assigning ownership, and setting checkpoints (30/60/90 days, 6 months post-launch, QBRs or just whatever works for you) for reviewing performance against your ROI forecast.
How can KangaROI help?
A key part of the KangaROI approach is the concept of Real ROI, i.e. the ROI you actually get from a project, not the ROI that was signed off. Tracking this Real ROI via Check-Ins throughout the lifecycle of the project keeps value delivery visible and accountable, making it easier to learn, adapt, and close the gap between intention and impact.
ℹ️ Read more about Real ROI and the concept of The business case as a living document
Forecasts aren’t built on real-world data
Without access to internal benchmarks or historical outcomes, ROI projections are often forced to lean heavily on vendor claims, industry averages, or gut instinct. While these may be directionally useful, they don’t reflect your organization’s specific challenges, processes, or constraints (and in the case of vendor claims, will unsurprisingly usually miraculously overstate the efficacy of the vendor’s solution and the huge benefits it will bring in).
This is a common trap, and one that people fall into even more when under time pressure, but ROI forecasts built on vague data are hard to defend and even harder to realize. They can also skew priorities toward projects that sound good on paper but that falter in practice.
So what can we do?
Your best bet is to anchor your forecasts in real-world data wherever possible, so use performance data from past initiatives (e.g. time-tracking systems, financial reports, support logs, etc.) to build credible baselines. If your organization doesn’t have this data readily available, then start small but start tracking it now, so that the data from this project can help improve the accuracy of your forecasting in future projects.
ℹ️ Read more about The role evidence and data play in a winning business case
How can KangaROI help?
As part of your KangaROI subscription you get access to kAI; your personal consultant who learns from your previous business cases and projects, to drive better decision-making. The more business cases and projects where you track the Real ROI in KangaROI, the more company-specific historical information kAI has to draw on, giving you bespoke advice, tailored to your company.
KangaROI also provides a library of business cases across a range of industries and use cases, curated by industry experts, giving you access to a reusable knowledge base based on real data, every time you need to start a new project.
Final thoughts: credibility beats optimism
ROI forecasting doesn’t need to be perfect, it needs to be credible. When you present realistic ranges, tie them to real-world data, and commit to post-approval tracking, you earn more than just sign-off, you earn trust. And that trust is what turns business cases into business impact.
