Value Modeler
In the April 2021 release of ClientIQ, the Value Modeler button will take you to the existing (legacy) version of the Value Modeler.
Steps
There are only four steps to get to the ROI results you need from the Value Modeler.
Inputs: when you enter the value modeler tool, inputs are automatically done for you, though you can edit any of the data if you choose to.
Benefit Assumptions: you’ll next make assumptions about the improvement benefit of your solution, which is expressed as a percentage range of improvement, for example, estimated one to three percent improvement.
Project Cost and Time to Implement: you’ll plug in these assumptions and they will then be weighed against your previously stated benefits in order to determine project return on investment.
ROI Results: once you finish the three steps above, return on investment (ROI) results are automatically calculated for you. The output is conservative, simplistic, and automatically formatted for you so that you can confidently present the results to buyers.
Inputs
The first page is the Inputs page, all inputs including the industry, currency, periodicity, and the financial data can be edited if needed.
All KPIs in the Value Modeler are grouped by the financial metric they impact. Click on the financial metric from the top navigation bar to view the KPIs included.
KPI Modeling
Within each metric, the KPIs are categorized by functional area.
Expanding each of the categories provides a complete list of KPIs contained within.
Each KPI has a definition detailing what’s included.
Line a. is the current value of the KPI – the best source for this is from the customer, but in lieu of having that information, the industry median benchmark for the KPI is provided in the gold box at right.
Line b. is the scope of your solution – what percentage of the KPI can you impact?
Line c. is the range of percentage improvement expected – the best source for this is your
experience with other clients.
Line d. shows the improvement to annual revenue based upon your inputs in lines a., b., and c.
Line e. shows the annual cash flow improvement based upon your inputs on lines a., b., and c.
Line f. illustrates the revenue growth (or profit margin) improvement in basis points.
Line h. is the resulting value of the KPI based on your inputs.
ROI Calculator
Click on the ROI tab in the top navigation bar within the Value Modeler.
Start by selecting the number of months to implement the solution and the number of years in your analysis. The most conservative approach is to leave the annual growth rate at zero.
Line a. is the adoption rate of the user base – i.e., how quickly will you have full adoption of your product?
Line b. is the investment in hardware.
Line c. is the investment in software, include renewal rates & amounts in years 1 – 3.
Line d. is the implementation expense including professional services, change management & education.
Line e. includes other & ongoing expenses like maintenance, personnel & training.
ROI Calculator Results
The Summary of Financial Benefits contains results for key investment metrics your customers will review.
Line ai: total net benefits over the years in the analysis
Line aj: return on investment
Line ak: payback in months, or how long it takes for the company to recover their initial investment
Line al: is the monthly cost of delaying a decision or doing nothing
Line am. Net present value is the present value of the solution’s benefits less the present
value of the investment & expenses
Line an: IRR is the interest rate at which net present value of all cash flows equals zero
Line ao: the average annual benefit to earnings per share (EPS)
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