Over the weekend, I was talking with some friends at a large technology company that is implementing AI across their organization. Our conversation led to AI ROI, and something my friend said struck a chord with me: “The definition of AI ROI changes depending on who you talk to.”
This resonated deeply because I have had this exact conversation with many clients. It is often the root cause of why businesses struggle to extract real value from their AI investments.
The ROI Disconnect
At my friend’s company, the problem was twofold:
First, ROI was defined so broadly that teams supporting AI initiatives could not connect their daily work to these high-level metrics. They were struggling to demonstrate how their specific outcomes were moving the needle on organizational ROI. This is a classic case of leadership setting ambitious goals without helping middle management and frontline teams understand how their work ladders up to those objectives.
Second, there was fundamental confusion about how ROI was being calculated. What exactly goes into the numerator and denominator of that equation? Different stakeholders were using different formulas based on their unique business priorities and perspectives.
From ROI to Outcomes
This experience reinforces my belief that traditional ROI is not always the best measure of progress for AI initiatives.
In my experience, when teams shift focus from abstract AI ROI calculations to specific, measurable outcomes, something remarkable happens: the returns and investments for those outcomes become naturally clear and well-defined.
For example, rather than asking “What’s the ROI of our chatbot?” we should be asking:
The Path Forward
For leaders implementing AI, I recommend:
- Break down broad AI ROI goals into specific, team-level outcomes.
- Ensure consistent calculation methods across departments.
- Create clear line-of-sight between daily work and organizational objectives.
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#ArtificialIntelligence #BusinessStrategy #ROI #ChangeManagement #Leadership
This post first appeared in my LinkedIn Newsletter AI Impact Weekly on March 4, 2025
