Engineering ROI: 5 Methods That Survive Board Review
A VP of Engineering presents a $1.2M microservices migration to the board. ROI projection: "we save 30% on infra and ship 2x faster." The CFO asks: "Show me the math." The answer is a single number, 240%, with no method behind it. The board says no. Two quarters later, a competitor closes the same migration in eight months and starts winning enterprise deals on latency. The project was good. The math was the problem.
There is no single "engineering ROI formula." There are five distinct calculation methods, each built for a different question. McKinsey's Developer Velocity Index research found top-quartile teams generate 4–5x the revenue per developer of bottom-quartile teams. That ratio means nothing without specifying how you measured it. Pick the wrong method for the question being asked and you will lose a defensible project. This article walks through all five with worked numbers.
