Public ROI – Advancing Return on Investment Analysis for Government IT


Project started on Dec. 1, 2005 (Completed)

After decades of investments in information technology, running into billions of dollars, governments are largely unable to convincingly demonstrate a return on investment that is widely understood or based upon well-grounded measures. Nevertheless, most agree that government has been dramatically changed by information technology (IT) and many programs and services are believed to be more effective and less expensive as a result. Unfortunately, it remains difficult to confirm those beliefs due to the lack of widely accepted standards or methods for public sector return on investment (ROI) analysis. This leaves governments without the kind of "bottom line" information that could reveal the value of IT investments across all kinds of programs and help guide new investments. What is needed is a way of doing "Public ROI" analysis that meets the special needs of the government sector. Public ROI analysis must account for both costs and returns in social, political, and economic terms that are broader and softer than the hard financial measures used in business. Of course, financial measures should also be used in government, but they seldom represent the full range of returns generated from public investments in IT.

Scope of Work

This project consisted of three main activities: (1) conducting an international workshop with experts in government IT to develop a research agenda and conceptual themes for public return on investment (ROI) assessment; (2) conducting five case studies of public ROI in governments internationally to include the US, Canada, and Europe, and (3) developing a white paper presenting a new methodology for assessing public returns on government IT investments. 

Agenda Setting Workshop

On July 13, 2005 the Center for Technology in Government, in collaboration with SAP, hosted a consultative workshop on assessing public return on government investments in IT. A select international group of 22 experts from government, academia and the private sector were invited to met with researchers from CTG to discuss the core issues and themes that make assessing public ROI for IT investments such a complex and difficult problem. CTG disseminated the results from this workshop to the participants and also the information collected to inform the follow-on research.

Representatives from the below government agencies, academic institutions, and private sector companies had the opportunity to work throughout the day to define and clarify issues, and to share knowledge about public ROI practices and experiences in the North America, Europe, and elsewhere.

Government representatives included:

  • Austrian Ministry of Finance
  • Canada Revenue Agency
  • U.S. General Services Administration
  • U.S. Government Accountability Office

Private sector representatives included:

  • Accenture
  • Cisco Systems
  • Gartner
  • IDC
  • McKinsey & Company
  • SAP

Academia representatives included:

  • Harvard University
  • Indiana University
  • University of North Carolina at Chapel Hill
  • Technical University Delft, The Netherlands

Case Studies

CTG, with support from SAP, completed its five case study site visits in mid April of this year. The CTG research team visited and interviewed key participants in government institutions both in the United States and internationally. Interviewees included senior government officials, IT and program managers, and system users who were willing and able to speak about the Public return on investment (ROI) of specific government IT initiatives that they were involved in.

In collaboration with the case study participants, CTG developed five case study reports. To view the reports, click on the links below. The five case studies included:

Project White Paper

During the spring and summer of 2006, CTG completed its analysis of the case studies data and related research findings. Based on both the case studies data and related research findings, CTG also developed its project white paper Advancing Return on Investment Analysis for Government IT: A Public Value Framework. Prior to publishing, the white paper was reviewed by a select group of thought leaders from the public and private sectors and academia. Participants from both the July 2005 Public ROI Workshop and the case studies were part of this expert review group.

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Funding Sources

This Public ROI project was made possible with exclusive funding and guidance from SAP, the leading provider of enterprise software solutions that help public sector organizations increase process efficiency and transparency while delivering public value to their constituents.