What is the aim of a return on investment (ROI) analysis in systems analysis?

The aim of a return on investment (ROI) analysis in systems analysis is to evaluate financial benefits against costs. This financial metric is used to assess the profitability or efficiency of an investment, comparing the relative gains or losses from the investment in a system against the costs incurred to implement it. By calculating ROI, organizations can make informed decisions about whether the benefits of a new system or project justify the costs, which is a critical consideration in systems analysis and design.

In this context, focusing on the financial implications helps stakeholders understand the overall value of a project and ensures that resources are allocated effectively to systems that yield the highest returns. Thus, it provides a clear picture of expected financial performance, enabling effective decision-making surrounding project approval and funding.