Defining ROI

by Ken Vincent, Featured Contributor

INVESTORS, managers, owners, lenders and entrepreneurs understand what return on investment (ROI) means.  Even someone buying a home hopes there will be a point at which it is worth more than they paid.  However, that may be problematic if one considers the cost of ownership, interest, and devaluing of money less the cost Calculatorto rent over the same period.

But, all of those have to do with a return on money invested.  I would suggest that we often miss some of the areas where ROI is very important.  Those areas having little or nothing to do with dollars.  What about the ROI on time and effort?

If you mentor a person, isn’t there an ROI for both parties?  If you read and study to improve your general knowledge or job skills isn’t there an ROI?  Even spending time on a hobby has an ROI.  If you  give time to a charity there is an ROI for both the giver and receiver.

Anything that one spends time and effort on should carry an ROI calculation or why do it?  The ROI may just be satisfaction in an accomplishment, or the enjoyment of having done it, or the knowledge that your action helped another person.

I believe that we all must periodically evaluate how we spend our finite allotment of time in terms of ROI.  What are you doing that has a high or low ROI?


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Ken Vincenthttp://sbpra.com/KennethVincent/
KEN is a 46 year veteran hotelier and entrepreneur. Formerly owned two hotels, an advertising agency, a wholesale tour company, a POS company, a leasing company, and a hotel management company. The hotels included chain owned, franchises, and independents. They ranged in type from small luxury inns, to limited service properties, to large convention hotels and resorts. After retiring he authored a book, “So Many Hotels, So Little Time” in which he relates what life is like behind the scenes for a hotel manager. Ken operated more that 100 hotels and resorts in the US and Caribbean and formed eight companies. He is a firm believer that senior management should share their knowledge and experience with the next generation of management.
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