What is ROI?

ROI, or return on investment, is a financial calculation that measures the success of an investment relative to its costs. The ROI formula is simple: (Gain of Investment) - (Cost of Investment) / (Cost of Investment). The result is expressed as a percentage, with a positive percentage being a good result and a negative percentage, bad.

ROI is often calculated when making decisions about call center investments, such as software purchases, comparing on-premises and hosted solutions, outsourcing, etc. Applying the simple ROI formula to these scenarios can be a complex undertaking because it requires a detailed understanding of current and future costs, as well as an ability to forecast future tangible benefits. For example, the Gain of Investment portion of the formula is a combination of additional revenue that will be realized from the investment and all costs that will be eliminated.

Organizations that conduct an ROI analysis may want to consider both a best- and worst-case scenario, with the understanding that the actual results will fall somewhere in between. Additionally, an ROI analysis may not be enough to make a decision. Organizations may want to supplement it with a payback period analysis, as well as calculating the internal rate of return (IRR).

Doing a thorough ROI analysis may be a significant undertaking, but organizations that invest the time and effort will be in a position to make sound, fact-based decisions. And, with best practices, they can evaluate the effectiveness of their analysis and take into consideration key factors for the next investment decision.

How NICE is Redefining Customer Experience

NICE CXone is the industry’s only interaction-centric platform where channels, data, applications, and knowledge converge to improve customer experience at scale.

It is the leading, most complete and unified CX Platform on the market, used by thousands of organizations of all sizes around the world to help them consistently deliver exceptional customer experiences. CXone is a cloud native, unified suite of applications designed to help you holistically run your call (or contact) center operations.

Back to Glossary

Contact us

If you would like to know more about our platform or just have additional questions about our products or services, please submit the contact form. For general questions or customer support please visit our Contact us page.