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Return on Investment can be a challenging concept to work with; it’s an art just as much as a science. If you project too low of an ROI, there won’t be much reason for a prospect to justify purchasing your product. If you estimate the ROI too high, your champion will be held accountable for delivering that value to their organization. Some organizations have a staff of value engineers ready to drop in and offer feedback on each and every business case. For everyone else, there are ROI Guardrails: a suggested minimum and maximum value for your ROI multiple.

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How to Access ROI Guardrails

Once you’ve added an investment to your business case, the ROI will be calculated by dividing the benefit and the investment. With ROI guardrails set up, you’ll be able to see what the typical range is for other business cases at your organization. Place your cursor into the ROI at the top of your business case to reveal the range. If your ROI is outside of the range you’ll see a yellow indicator and the bell icon. Rest assured that guardrails are only for your eyes. Your champion and external users will never see a warning or the optimal ROI range, instead, it will always have the typical green background.

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What to do when you ROI is out of Range

If your ROI is out of the typical range, you have a few options that you should consider in this order:
  • Introduce additional use cases. This depends on your organization, but sometimes a low ROI is a suggestion that your prospect needs to see more value from your product. You might ask yourself if the prospect mentioned any additional problems you could help them solve.
  • Adjust the inputs in your Use Case. You don’t want to make something up, but it can be helpful to ensure that all of the numbers accurately represent the prospect’s situation. A classic example is Number of Seats, perhaps selling in more licenses would have a positive effect on the calculated benefit.
  • Tweak the Investment. Again, this depends on your organization, but mathematically lowering the investment will increase the ROI (and if you’re promising too much value for the price, increasing the investment will lower the ROI).
  • Talk to your Manager and Maybe… Do Nothing. There’s nothing inherently wrong with delivering more value to a customer. You might decide that for this context, it’s okay to present with an ROI that’s outside of the typical range.

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For Admins: How to Change the ROI Guardrails

Go to your Value Framework and navigate to the new Settings Tab. The ROI Minimum and Maximum can be set in the input fields. You’ll see a preview of the guardrails indicator underneath which shows what an account executive would see in their business case. You can change the ROI guardrails at any time, but this will apply to all existing and future business cases in your organization.