PortfolioC3-5

AI Investment Strategy and Portfolio Governance

AI Business Case and ROI Builder

SIMULATEDVerified Jul 2, 2026

A single ROI number rarely survives executive review. This artifact builds the case as a range, identifies the assumption the value depends on most, and turns the analysis into a fund, fund with conditions, or do not fund recommendation. Adoption ramp ties to EL-01.

Same instrument · three industries pick a use case to reconfigure the run

Prefer to read? The two minute case study · problem → approach → metric → outcome

Problem

AI business cases are often fragile because value, adoption, run cost, and implementation effort are uncertain. Funding decisions need to see the range, the payback, and the driver that can break the case.

Approach

The builder calculates NPV, IRR, payback, run cost impact, adoption ramp, and sensitivity. A tornado view shows which assumption creates the largest swing in value.

Why this way

This connects AI funding to financial discipline, value realization, adoption risk, run cost, and executive approval.

The metric

NPV and payback; the widest tornado bar (the driver the case hinges on).

The trade-off

Optimistic value versus conservative adoption and run cost assumptions.

Outcome

A fund/defer decision with the fragility named, not hidden in a point estimate.

$600k
$1.40M
9 mo
$180k
12%
NPV · 3yr
$1.91M

@ 12% discount

IRR
143%

Break even discount rate

Payback
0.8 yr

Undiscounted

Tornado · NPV sensitivity (±30%)

Annual value$1.03M … $2.80M
Upfront investment$1.73M … $2.09M
Discount rate$1.75M … $2.09M
Adoption ramp$1.77M … $2.05M
Run cost$1.78M … $2.04M

Dashed line = base NPV $1.91M. Widest bar = the driver that most moves the case.

Steering pre read · business case

Fund

AI initiative, 3-year business case

NPV (range)

$1.03M to $2.80M

IRR

143%

Payback

0.8 yr

Recommendation: Fund. The case stays NPV-positive across the full ±30% sensitivity band. Largest lever: annual value.

If you act on this · the call → expected lift → how you'd measure it

The call

Fund, fund with conditions, or defer based on range, sensitivity, and payback.

Expected lift · illustrative

Improves funding discipline by surfacing the driver that can make or break the case.

How you'd measure it

NPV, IRR, payback, sensitivity driver, adoption progress, realized value vs modeled value.

Present the range, not the point

A single NPV invites a fight about the assumption behind it. A tornado shows you already stress-tested it, and names the one driver leadership should actually govern. That's what moves a case from “interesting” to “funded.”

Steering committee takeaway: Present the range, not only the point. Points get challenged. Ranges with clear assumptions get governed.

How this is built

Cash flows: year 0 = −investment; year t = annual value × average adoption (linear ramp) − run cost, over 3 years. NPV discounts at the chosen rate; IRR solved by bisection; payback interpolated on undiscounted cumulative flow.

Tornado varies each driver ±30% and re computes NPV; bars are sorted by swing and centered on the base NPV. Stack: Next.js (static) + shared design system; client side.

Limitations: this is a portfolio business case artifact. Real funding decisions would require finance validation, benefits ownership, implementation estimates, risk adjustments, and post launch value tracking.