Respond When Finance Requests an ROI Model

A finance request for an ROI model calls for a decision record. Finance needs each number, its source, its owner, and its review status. A finished spreadsheet with a large return figure asks finance to accept a conclusion before examining inputs. Start with a shared structure instead. Leave uncertainty visible. Invite finance staff to change values. Their edits produce a model suited to their planning process.

Ask what decision the model will support. An annual planning discussion has different needs from a request for pilot funding. A comparison between an existing process and a proposed process needs clear treatment of both sides. Ask who will review numbers and when review occurs. A model needed for a Tuesday budget meeting needs an earlier input check. A model for a later planning cycle leaves room for a deeper review. Write each deadline beside its owner. A date without an owner often becomes a quiet source of delay.

Keep version one narrow. Choose one workflow where effort, delay, or cost matters to a buyer. Do not place every hoped for outcome into one sheet. Broad models become hard to inspect. One weak estimate raises questions about stronger inputs. Suppose a reporting team prepares one monthly package. Record who prepares each package, how often preparation occurs, what record shows current effort, and what part of work might change. Leave a missing value blank until a named owner supplies a source.

Set up a table with rows for each assumption. Include current value, source, owner, date checked, status, and a note. A source might say March work log or finance ledger category. Status labels such as confirmed, estimate, and open question help readers see where review belongs. Do not hide an estimate inside a formula. Put a clear label beside every estimate. Finance staff often accept a provisional input when they see a realistic path toward confirmation.

Labor deserves separate treatment from budget savings. A person might spend fewer hours on a task after a workflow changes. Finance might view released time as capacity for existing work. Finance might count savings only after an approved staffing or expense change. Ask, "How does your group describe time released from this task?" Keep capacity and budget impact in separate rows if finance treats them differently. A seller has no reason to decide which label belongs there. Finance owns this choice.

Consider a fictional practice situation at Lumen Harbor Software. Priya, an account executive, hears from Morgan, a finance analyst. Morgan says leadership wants an ROI model before approving a pilot. Priya schedules a working session with Morgan and Lee, who manages reporting. She opens with one question: "Which current costs or operating measures does your group trust for planning?" Morgan names a payroll report and a ledger category. Lee says four analysts prepare a monthly package. Nobody has measured every hour yet.

Priya enters four analysts, one package per month, and both named sources. She marks analyst effort as an open question. Lee agrees to review logs from three recent work periods. Priya then asks, "If preparation time falls, does finance record released time as capacity, expense savings, or another measure?" Morgan says no staffing change appears in the plan. The model should show capacity separately from budget savings. Priya removes a proposed savings row. She adds a capacity row with an estimate label and Lee as source owner.

Timing changes an ROI discussion. A buyer might want annual value, yet adoption and workflow changes influence when a measure begins. Do not choose a start month on your own. Ask what event begins a new process and who will confirm completion. Use monthly periods when timing matters instead of one annual total. If adoption timing lacks confirmation, show two cases tied to stated dates. Label one as an earlier start assumption and one as a later start assumption. Finance staff then see why totals differ.

Costs need equal attention. Include known fees only when an approved source supplies them. Ask which internal effort belongs in planning. Morgan might want project review time in total cost. Another finance team might exclude work already funded through an approved plan. Put internal review time in its own row, name its source owner, and ask finance whether inclusion fits their method. Do not hide internal work merely because omission gives a more appealing result.

Scenarios need a stated reason. Labels such as low, expected, and high mean little on their own. Tie every case to one changed input. In Lumen Harbor's model, the earlier start case uses a July workflow date. The later start case uses an August workflow date. A separate effort range stays open until Lee finishes log review. Do not move several inputs at once without notes. Readers should trace every difference from an output back through one visible input.

Separate product information from customer assumptions. Product information belongs in an approved source. Customer assumptions belong in rows named for customer workflows or measures. This division keeps a meeting from drifting toward unsupported statements. When Morgan asks where a figure came from, Priya points toward a customer record, an approved product source, or an open question. No reader should need to guess an origin.

Set a review meeting before sending version one. Priya says, "I will send a working sheet today. Would Thursday give Lee enough time to mark values needing revision?" During review, start with sources rather than outputs. Ask which value finance would remove, replace, or split. Early scrutiny costs less than a surprise during an executive meeting. A buyer who edits assumptions becomes part of the business case.

Benchmark requests deserve a purpose question. Finance might seek an internal starting point for an unknown value. Finance might seek a range for planning. Ask whether a benchmark will become a decision input or frame a research question. If an approved source does not exist, write open research question. A small model built on owned information gives reviewers more to work with than a large model filled with untraceable figures.

Watch formulas for hidden decisions. An annualized capacity figure might treat every released hour as budget savings. A payback result might leave out internal review time because nobody discussed whether those hours belong in cost. State each decision in a note beside the row. Ask a finance owner to confirm or revise the note. Clear notes keep a meeting focused on the business choice rather than a surprise inside a calculation.

On Wednesday morning, Lee reviews three months of logs and enters a monthly average beside his name. Morgan chooses August as the value recognition month and marks internal project review time for inclusion. Priya updates those two rows, sends the sheet for Thursday's budget packet, then opens the meeting by asking Morgan to approve the source note for internal review time before anyone reads the final output.