Whether you work for a private sector company, a not-for-profit organization, or in the public sector, your organization makes investments to drive financial performance. In the private sector, that means profitability; in the charity segment, it’s about achieving more with available funds; and in the public sector, it focuses on maximizing public benefit within budget constraints.
But financial performance varies in meaning across organizations, and so do the ways to measure it. It’s not just about increasing incoming revenue or reducing expenses directly. Many other methods can impact a business’s financial performance and help them go beyond the bottom line.
The Case for Innovation
Take innovation, for example. Investing in innovative projects may lead to new products or services that increase revenue and profitability, but it also achieves more. It shows your customers, both current and potential, that your company commits to progress and staying on the cutting edge. That attracts early adopters and gives mainstream customers confidence in doing business with you.
It also highlights your dedication to continuous advancement, reassuring customers that your offerings will remain relevant. By leading rather than following competitors, you appeal to those who pride themselves on being different from the crowd.
Considering Sustainability
Now consider sustainability. It’s the right thing to do, but organizations prioritize it more now because it also boosts performance. From a practical view, sustainable practices can reduce costs related to energy, transportation, and packaging.
Reputationally, using recycled materials, making products recyclable (or offering that service), demonstrating green initiatives, and reducing product footprints all make your brand more attractive. You retain customers by showing your genuine commitment to sustainability and likely attract new ones from competitors who lag behind.
Do these factors directly affect your bottom line? Sometimes, but they always have an indirect impact. The challenge lies in demonstrating that contribution. Showing revenue from a new product is simple—just check the sales numbers. Proving a service enhancement’s profitability is also clear—look at margin figures. But how do you measure the benefits of innovation, sustainability, or other less tangible factors?
What’s the Answer?
The answer lies in using a world-class strategic portfolio management (SPM) or project portfolio management (PPM) solution like Sciforma’s. This approach lets you manage all strategic investments in one place while giving execution teams the freedom to use their preferred tools. Critically, it supports managing investments from initial planning through benefits realization.
When you define an investment, you also outline its expected benefits. Stakeholders can then understand what contributions are needed at any stage of the work. Whether it’s revenue, profitability, cost reduction, innovation, sustainability, risk management, employee satisfaction, customer satisfaction, compliance, market share, or any other performance measure, you can clearly connect each success criterion to the investment.
But defining metrics is crucial. What determines whether you hit your sustainability target? How do you measure innovation? Those decisions are yours, but the right PPM solution ties these metrics to the work, so everyone knows what must be achieved and how success will be evaluated. Whether it’s a financial metric linked to a GL code or the CEO’s subjective approval, everyone understands the criteria.
If your current tool suite doesn’t provide this capability yet, and you’re not going beyond the bottom line, we’re here to help.
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