Appraising the value of corporate intranet and portal investments is, at best, an imperfect science. In fact, most analysts contend that
precise ROI measurement is not possible due an intranet’s expansive and far-reaching nature. However, while measuring the precise ROI
may not be achievable, there are means by which many organizations can and do quantify both potential and existing ROI.
Generally speaking, intranet ROI can be lumped into one of three broad categories: there are hard savings that result from the cost avoidance of printing or distributing documents, and latent, soft savings from enhanced access to information, communication, collaboration, and decision-making, among other things, and of course increased revenue as a result of an intranet implementation.

The principal challenge for appraising intranet ROI is that it is often easier to assess the ROI of specific applications deployed on an
intranet than measure the ROI of infrastructure and/or the portal itself. In fact, most demonstrable ROI case studies highlight
application ROI, such as employee self-service and e-procurement, rather than the ROI of the entire intranet or portal. Hence the chicken-or-egg dilemma: you cannot aggregate and deploy highvalue web applications without the underlying infrastructure, but it
is difficult to justify the infrastructure investment without the greatly desired ROI from such high-value applications.
Undoubtedly, this challenge is one of the key factors in why so many organizations value ROI, but few are measuring it. A recent intranet ROI study found that while 76% of respondent organizations believe ROI to be important or very important, only
6% of organizations undertake ongoing, specific measurement of the ROI of their intranet. Occasional measurement is done by only 24%
of organizations and 51% either do no measurement or guess.

To what extent is your organization measuring the ROI of your intranet or portal?
» Not at all 23%
» Only guesswork 24%
» Considering measuring 18%
» Occasional measuring 24%
» Ongoing significant measuring 6%
» Don’t know 4%
Total 100%

Seventy-nine per cent of companies now require ROI analysis to be performed on IT investments.
(Source: Ernst & Young, 2002)

A Harte-Hanks Market Intelligence survey found 90% of Fast-Track 500 companies have intranet investments that are paying off. 48% of those surveyed said they are satisfied or extremely satisfied with the return on their investments. Only 9% were dissatisfied.
(Source: Corporate Intranets Enter Portal Space, PC Week Online, November 15, 1999)

Benefits
There are many ways to organize and segment the measurable benefits from intranet investments. While this paper opened by dividing ROI into three general categories, hard savings, soft benefits (savings) and increased revenue, these are general in nature and do not provide a framework for actual measurement.
A glimpse into the expected and measurable ROI benefits at a standard organization was highlighted in a survey conducted by Darwinmag.com. Darwin asked 138 business executives to rank the top five goals or expectations from their Information Technology investments. For the year 2002, the rankings changed and the top expectation from 2001 (Empower employees with access to information) did not even make the list:

1. Create/Increase competitive advantage
2. Reduce cost of doing business
3. Improve efficiency
4. Improve customer service
5. Generate more revenue

To meet these expectations and to plan to deliver specific ROI, and to measure this value, a more detailed approach is required. To offer a general framework for examining and measuring the potential ROI in organizations, we segment intranet benefits into 10 broad categories:

1. Hard Costs
2. Sales
3. Productivity
4. Competitiveness
5. Application Access
6. Infrastructure
7. Collaboration
8. Time To Market
9. Customer Service
10. Human Resources

Verizon's intranet portal, Ventana, supports the telecommunications company's wholesale operations centers. 6,000 users, including internal call centre staff, service, reps, and senior management, use the portal for message boards, information on methods and procedures, tariff and regulatory information, and maintenance data.
The portal has also delivered more efficient communications. Prior to the portal, reports were sent out to 900 users three times a day by email. Now each report is posted on the portal eliminating 15 million emails per year and the attached documents to each.
(Source: Goodwin & Nielsen, Building Intranet Portals: A Report From the Trenches, April 2003)

Source: Prescient Digital Media