Making

ROI

Work

Joe MatthewsALA Annual LLAMA Program

June 2010

Investments

Cost-Benefit Analysis

Value of a Library

• Use Benefits

• Nonuse Benefits

Value Taxonomy

Money saved

Time saved

Accomplishments

“Free Stuff”

Cost Avoidance

Value Calculation

Alternative cost

X

amount of use

Value Calculator

Direct Economic Benefits

Economic impact of library spending

Direct Economic Benefits

Library

as

Destination

ROI Studies

Consumer Surplus Survey

Observations

Indirect Benefits

Contingent Valuation

Willingness to Pay

Willingness to Accept

Nonuse Benefits

Option to use in the future

Option for others to use

Total Value

• Direct use value – 40%

• Use in future – 20%

• Use by others – 40%

Utility of ROI Studies

Improved credibility

Complements other use measures

Complements qualitative information

Frameworks

Library Balanced Scorecard

Social Return on

Investment

Resources

• Measuring for Results. Libraries Unlimited, 2004

• The Evaluation and Measurement of Library Services. Libraries Unlimited, 2007

• Measuring Your Library’s Value. ALA Editions, 2006.

• Worth Their Weight. Americans for Libraries Council, 2007.

• Making Cities Stronger. Urban Libraries Council, 2007.