What ROI really means
The term ROI is commonly taken to mean ‘return on investment’. ROI stands for what you get back from an investment.
But what is that exactly? What do you actually get back as return on your investment? According to this definition, it could be anything. The traditional business definition of ROI is much too broad, too superficial, has no deeper meaning.
This website has already made amply clear that the Bitsing method represents the new modern economic era. It’s an approach in which tools and terms are specifically defined – so there’s no room for the ‘free translation’ of meaning that ROI invites. Accordingly, in the world of Bitsing, the term and concept of ROI – return on investment – just don’t exist.
What if your ‘return’ is a financial loss and collapses your organisation? You can achieve a great ‘return’ on your investment with increased sales and new customers – but you can still go bankrupt because you paid too much for the return.
So from now on we’ll only talk about ROS. With the Bitsing method you can now look forward to having a Remainder On Spend – in which you end up with more money than you spent on achieving your objectives (a Remain). Traditional business thinking was happy with ‘return on investment’. In Bitsing we focus on the positive financial remain, delivered by the money you spent – the Remainder On Spend. This is what it’s all about. And, as you can see, rather not talk about ‘investment’ at all, but rather about ‘spending’. Investment implies that you never know what you will get in return. While with expenditure you know precisely.
Forget ROI, say hello to ROS: Remainder On Spend.