• US $9 million in year one (in fact an ROI of less than 1, so the investment is producing a net loss);

• US $27.2 million in year two (which means the investment is beginning to pay back);

• US $63.6 million in year three (which is a very handsome payback).

The investment is high, so the risk is higher, particularly in the first period of the project, but the eventual net benefits are also high.

A second company also has a turnover of US $500 million. However, it has scored 75 per cent on a CMAT assessment, which means that it is just in the top quartile overall. Target benefit is US $100 million (averaged over three years). Applying ROI criteria (ROI for this quartile = 5), it needs to invest US $20 million over three years to obtain this (27 per cent less). Assuming this investment is split evenly between the years (c. US $6.67 million per year), it should see returns of:

• US $30 million in year one (an immediate payback);

• US $33.3 million in year two (continuing payback; similar to year one);

• US $36.7 million in year three (continuing gradual rise in payback relative to year one and year two).

This company has a lower investment and a much lower risk associated with the payback.

Another way of looking at this is that a company that stays in the bottom quartile will have to make about 4.5 times the investment of a similar-sized top-quartile company for the same return. However, as its CM performance improves, it will need to invest less.