– Grace Hopper
“We thought about doing it, but couldn’t agree on the value…”
– Anonymous hospital administrator
Calculating the return on an investment (ROI) is relatively straightforward when the independent variables (components of cost) and dependent variables (desired outcomes observed within some defined period) are objective and quantifiable. This is less true when the dependent variables are surrogates for the desired outcomes at some future date. Examples of the latter include greater brand awareness, enhancements of brand image or improvements in guest/patient satisfaction as predictors of loyalty. This is because there are many catalysts of brand choice…including availability, access restrictions, price, and competitive alternatives…for both hospitality and healthcare service providers.
Nevertheless, investments designed to enhance the overall customer experience must be evaluated by predictive metrics and with some reasonable cadence to estimate both their short-term and enduring impact on organizational performance. This evaluation is essential to determine the wisdom of sustaining, amending, or terminating the related investments to achieve a desired return over time. We explore these issues in this chapter.