By Norman Oder

• First ROI study in the academic realm
• Limited to grant income, rather than other library value
• Expansion of study ongoing

While return on investment (ROI) studies have become common in the public library arena, a pioneering ROI case study involving the University of Illinois at Urbana–Champaign (UIUC) suggests that each dollar invested in the library in 2006 returns $4.38 in grant income. The study, while limited in scope and arguably in need of refinement, has spurred research at several other universities worldwide.

The study, University investment in the library: What’s the return?, was sponsored by Elsevier, whose staffers in 2006 had begun to notice that university administrators were increasingly asking about research performance measurement, cost justification, and return on investment. At a North American Library Advisory Board (NALAB) meeting, Elsevier proposed the idea of doing a case study and Paula Kaufman, UIUC’s University Librarian, volunteered, according to Elsevier VP Chrysanne Lowe.

The study was led by Judy Luther, President, Informed Strategies, with input from project advisor Carol Tenopir, professor at the School of Information Sciences at the University of Tennessee, Knoxville (and an LJ columnist) and Elsevier’s Lowe and Kira Cooper. It was inspired by an article by Roger Strouse, VP and Lead Analyst with Outsell Inc., who described how corporate and government libraries save users time and help generate income with library resources.

The model
For the university environment, the model was based on the use of citations drawn from library resources in grant proposals, the success rate for proposals, and the average grant award. A survey of UIUC faculty validated assumptions in the model, confirming the importance and frequency of citations in grant proposals, and the likelihood that the citations used in grant proposals were drawn from library resources, according to Luther’s paper.

Also, faculty members explained how access to electronic resources changed the way they work, allowing them to integrate digital resources into their work regardless of their location, pursue interdisciplinary research more easily, and to save time and work efficiently.

The ROI model has its limits; it  does not address the value of resources to faculty in conducting their research or teaching, nor the value to students of the library. Indeed, the paper acknowledges that it “would be useful to expand the model to include other factors in the complete system of inputs (e.g., library resources, faculty, staff, and students) and the influence of each on the system.”

Drilling down
The study states that “the faculty participating in the survey clearly confirmed assumptions in the model…. 95% of responding faculty state that citations are important in securing grant awards, 94% of responding faculty use citations in grant proposals, and 94% of responding faculty obtained citations via the campus network or Library Gateway.”

LJ had some questions. The proportion of a grant secured using library materials is calculated by multiplying the percentage of faculty using citations in grant proposals, the percentage of proposals incorporating citations obtained through the library, and the size of the grant. But how can we be sure that the proposals were successful solely because of the citations?

 “Citations are one of several factors that are part of successful proposals, but they are an essential element without which the proposal would not be considered,” Luther responded. She acknowledged that “there is a case to be made for a broader model. This was a first step in the direction of quantifying a revenue stream”

Also, the university return in grant money on library is calculated by dividing the grant income using library materials by the total library budget. Shouldn’t the calculation instead use a subset of the library budget, that for electronic resources? Luther said the rationale was “that there are staff and support costs associated with acquiring the materials cited and a focus on just the budget for electronic resources would not include these associated costs.”

Going forward
Outsell’s Strouse commented recently, “This is the kind of library ROI result that makes administrators sit up and take notice (and continue funding a top-notch collection). The lesson for all library managers, regardless of sector, is to inextricably tie expenditures to outcomes that will resonate - and what usually resonates is dollars and cents.”

The study notes that, in reviewing the model, Bruce Kingma of the Martin J. Whitman School of Management and the School of Information Studies at Syracuse University, suggested it would be worthwhile to expand this study to include a complete system of inputs.

Meanwhile, Tenopir is supervising a replication of the study at another eight universities around the world. It keeps the same scope, looking at grants income, Tenopir told LJ; she and Kaufman are also working with a team of researchers putting together a third phase proposal to extend the methodology beyond grants.

The impact at UIUC
UIUC’s Kaufman told LJ that the study was not undertaken to make a budget argument. “Instead, we were eager to begin to tackle the very complex set of issues that surround the challenge of quantifying the value the Library brings to the University. Indeed, until we see the results of the replicated study results, we do not even know how the figure we calculated for the return on the University's investment in the Library, based only on one year's of data, compares with the returns calculated in other institutions.” 

She said she expects to see a range of ROI figures, which reflect differences among the participating institutions, their grant funding, and the library investment, glossed by other factors, including research intensity, historical investments, and consortial buying opportunities

However, she cited an “unmeasurable positive impact,” involving “the buy-in and participation from campus administrators, particularly the Provost, and the engagement of other academic deans, all of whom are struggling with similar issues of how to quantify outcomes and impacts in meaningful ways.” 

Also, she said, participation in this phase positioned the library to be involved in future phases. In presentations on five continents, she said, “The responses have been uniform: intense interest and eagerness for the next phases to move ahead swiftly.”

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