Return on Investment (ROI) Calculations and CAPEX Decisions

Gilad Issar and Liat Ramati Navon

Chapter 28 in Operational Excellence, 2016, pp 129-130 from Springer

Abstract: Abstract Return on Investments (ROI) calculations helps us in planning the operation’s annual budget and to compare between different alternatives for investments. ROI calculations helps us to sort the project list, and find few “anchor” projects, which have the highest return on the investment. Those projects helps to improve the operation’s financial results along the annual budget. The major projects, together with new and innovative projects, are reviewed in advance and on a monthly base. Through continuously review of the project advance, we compare the projects predicted ROI results with the actual savings. This follow up assists the operation in improving the accuracy of its project’s ROI calculations and the improvement in planning the next year’s cost improvement projects timelines.

Keywords: Return on investment; Capital expense; Annual budget; Department saving; Cost reduction projects (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:spr:mgmchp:978-3-319-20699-8_28

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DOI: 10.1007/978-3-319-20699-8_28

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