Definition #
A financial modeling tool that estimates return on investment for AI projects by comparing implementation costs to operational savings and revenue gains.
Key Characteristics #
- TCO (Total Cost of Ownership) analysis
- Impact velocity estimation
- Scenario modeling
- Integration with ML monitoring tools
Why It Matters #
Forrester reports 43% of AI projects fail to demonstrate positive ROI without proper tracking tools.
Common Use Cases #
- Vendor selection between cloud AI platforms
- Budget justification for automation initiatives
- Post-implementation performance tracking
Examples #
- AWS AI/ML Business Value Calculator
- DataRobot ROI Toolkit
- Custom spreadsheets with Monte Carlo simulations
FAQs #
Q: What costs are often overlooked?
A: Data cleaning (20-40% of budgets) and model maintenance (3-5x initial dev costs).
Q: How accurate are these calculators?
A: ±15-25% variance for first-year projections—best used for comparative analysis.