Sunday, November 17, 2002

One of the better talks at KMWorld 2002 was by David Gilmour of Tacit on ROI and Measurement. The gist is that most people askign you to prove ROI are faking it: they rarely demonstrate ROI for the thigns that really matter to them, they just go ahead and do them. Hence its much more important that KM shows how it impacts ont he important stuff, than it is to show some pseudo-accountancy.

My own thoughts are that saying 'Whats the ROI' is one of those stalling questions that sounds like a legitimate request when said in front of the board but is really a way of saying "I don't believe in KM" that sidesteps getting into a debate about it. I suspect no senior managers ask the ROI question of things that really matter to them, i.e their real core values rather than their espoused ones.

So here's my list of "Expensive things that never get asked to show ROI"
* Global workshops where execs jet in from all over
* Most training courses
* Furniture beyond the bare necessities (including the ROI of carpets, plants and large desks)
* Most downsizing programmes (they show apparent savings, but they imply one investment strategy over another, and nobody works out which ultimately yields more)
* Attractive buildings vs. concrete monsters
* Public parks
* Travelling non-Economy class
* Owning a cat
* Calculating ROI
I'd welcome more suggestions!

NB I'm not saying nobody ever challenges the cost of these, only that thay have huge intangible impacts that nobody has a handle on. It all comes down to what accountants see as assets vs. costs. Sadly employees are generally seen just as a cost, so investing in them is impossible unless your organisation uses some form of Intangible Assets accounting. So the next time you're asked to show ROI, say "sure, just show me how you assess intangble assets and we can discuss where KM fits in".

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