Companies are under cost pressure: this is especially true today, but it has always been the case. Smart business management means ensuring that expenses pay off and deliver a positive return on investment (ROI) within a foreseeable time frame.
The same applies to IT budgets: organizations should benefit more from software solutions than they spend on them. Factors such as significant efficiency gains, quality improvements, or higher customer satisfaction are among the clearest indicators of a positive ROI. Even small time savings, more clarity for employees, or slightly better structures can already make a big difference.
This article explains how to reliably achieve ROI in IT Service Management (ITSM) and Enterprise Service Management (ESM).
Payback in Software Investments
Saving money leaves reserves. But those who don’t invest also miss out on profit opportunities. Many organizations with limited IT budgets therefore face tough decisions: Should they accept investment costs or save money and thereby miss out on potential gains such as productivity increases, higher efficiency, or improved customer satisfaction?
It’s easy to choose the former when the benefits are clear. The real challenge, however, is that many prospective buyers don’t know how to use software to its full potential – and often apply it only in very limited ways. Those who know how to use it effectively, on the other hand, can expect relatively fast payback.
The basic prerequisite for achieving a positive ROI is therefore to carefully explore the possibilities a software solution offers.
Why ROI Is Such a Key Metric
Return on Investment (ROI) measures the profitability of investments – data-driven and value-oriented. In IT or software decisions, it helps compare different options, make informed choices, and allocate available resources in a targeted way.
While qualitative benefits are important, most business cases require measurable, quantitative outcomes with a focus on financial returns. For example, a modern, intuitive user interface can only serve as a valid element of decision-making once its (financial) benefits can be quantified.
Sample ROI Calculation: Implementing a Ticketing System
A ticketing system offers organizations a range of advantages such as centralized information flow, automation, and service optimization. These are all valuable benefits, but they only become truly meaningful once translated into financial terms.
In practice, multiple factors come into play here – for instance, the financial equivalent of a 10% increase in customer satisfaction.
To illustrate, let’s stick to a simple example:
- Costs: License + Implementation + Training = €50,000 in the first year
- Benefits: Through automation, support employees save 200 hours per month. At an average hourly rate of €35 (including full costs), that amounts to €84,000 per year.
ROI = (84,000 – 50,000) / 50,000 = 68%
In this case, the investment would clearly pay off, with amortization within the first year.
Tips for More Accurate ROI Calculations in ITSM/ESM
While the above example is simplified, it already provides a useful ROI estimate. For more precision, organizations should consider:
1. Total Cost of Ownership (TCO)
A more accurate approach involves concepts like TCO, which includes indirect costs, operating costs, and end-of-life expenses to provide a holistic view.
2. Maturity Level
The profitability of software also depends on the maturity of existing processes. A maturity assessment reveals where optimizations and professionalization will pay off most. Running such an assessment before calculating ROI can be highly beneficial.
3. Direct and Indirect Savings
Software benefits are not only direct – such as labor-hour savings or reduced ticket volume – but also indirect, like opportunity creation, better customer experience, or higher employee satisfaction.
Software can also indirectly influence hard metrics, such as customer churn rates, by enabling faster and better ITSM services.
4. Multiple Benefit Factors
To achieve accurate ROI calculations, include:
- A realistic cost base such as TCO
- Full employee costs (including social contributions, infrastructure, etc.)
- Differentiated benefits:
1. Hard savings: labor hours, errors, downtime
2. Soft savings: customer satisfaction, response times, compliance
5. Additional Recommendations
Run different scenarios – conservative, realistic, and optimistic. Decision-makers may also define a time horizon; three years is usually long enough yet still manageable.
As an additional ROI indicator, a payback period can be helpful. It shows how long it will take for the investment to pay for itself. This figure – e.g., “payback after 16 months” – is often more tangible than ROI alone.
Self-Service Portals: A Key ROI Factor
There are many ways to financially benefit from well-implemented ITSM and ESM – including the extension of ESM to non-IT departments.
One of the most direct ROI examples is the introduction of a self-service portal. Such a portal reduces the workload of customer support by lowering the number of tickets and requests to process.
In short: by enabling end users to handle tasks previously managed by the service desk, organizations reduce costs while also delivering faster problem resolution. This improves satisfaction, which in turn has indirect financial benefits.
Calculating ROI for Self-Service Portals
To calculate ROI for a self-service portal, you need:
- The total number of monthly service desk tickets
- A realistic estimate of how many tickets can be deflected via self-service
- The average handling cost per ticket
- The initial and ongoing costs for self-service
Note: Since self-service functionality is often included in modern ITSM platforms, some costs may count as optimization of existing investments.
This type of calculation provides quick insights, but also reduces complexity. A holistic view – including indirect and qualitative factors – is always recommended.
AI as an ROI Driver
There are many factors that drive a high ROI. Even small productivity gains of just a few percentage points can have a major impact.
However, beyond self-service portals, AI applications and automation exert the strongest and most direct influence, as they eliminate many manual steps. With the right AI support, employees also gain rapid, well-founded insights, leading to better outcomes.
Key AI applications that serve as ROI drivers include:
- Ticket classification and service descriptions
- Automated response generation
- Real-time translations
- Sentiment analysis
Conclusion: ROI – One (Important) Part of the Truth
Investments must pay off – this principle applies to IT Service Management (ITSM) and Enterprise Service Management (ESM) just as it does in general business. Especially with limited budgets and the need to invest wisely, ROI serves as a key metric that provides valuable guidance.
Decision-makers, however, should keep in mind that ROI represents only part of the picture. Additional indicators such as the payback period, results from a maturity assessment (easy and quick to conduct), or qualitative, non-quantifiable factors also contribute to the full evaluation.
