COMPEL Glossary / return-on-investment-roi
Return on Investment (ROI)
Return on Investment (ROI) is a financial performance measure calculated as (net benefits minus costs) divided by costs, expressed as a percentage, used to evaluate the profitability of an AI transformation investment.
What this means in practice
While conceptually simple, calculating AI ROI is notoriously difficult because benefits are often indirect, attributable to multiple causes, delayed in materialization, and distributed across organizational boundaries. For organizations, ROI quantification provides the financial accountability that sustains executive support and funding for transformation programs. In COMPEL, ROI quantification is covered in Module 2.5, Article 4, where the AITP learns conservative attribution practices, multi-horizon value measurement, and the art of communicating ROI honestly when results are genuinely disappointing, building credibility through transparency rather than inflated claims.
Related Terms
Other glossary terms mentioned in this entry's definition and context.