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Do You Really Need to Justify Your RFID Investment?

Maybe not—if you think of the technology as infrastructure that can deliver many benefits, then calculating the ROI on any one application becomes less critical.
By Mark Roberti
Nov 02, 2009I've been making the case for years that while radio frequency identification can solve many individual business problems, companies, governments, libraries and other organizations should deploy it as infrastructure. That is, rather than buying a system only to track assets, promotional displays, patients or parts, they should purchase a system that handles many applications—just as they use the Internet for a lot more than just e-mail. If CEOs start to think of RFID as infrastructure that is essential to managing their business, then justifying the deployment with a return on investment (ROI) becomes less critical, maybe even unnecessary.

Let me explain. Very few companies, if any, justified their investment in Internet technologies with an ROI study. Why? Because having an Internet site was essential—it was expected in order to seem like a legitimate company—and because it enabled many different applications, which made determining the ROI difficult. Similarly, companies don't conduct ROI studies on computers for their employees, because people need them to do business.

I know what you're thinking: "But no one needs to have RFID." In my view, that's just wrong. Almost every midsize to large company needs to have RFID—they just don't know it yet.

It might sound like I've gone off the deep end to say companies don't know what they need, but let me ask you this: In 1995, did your firm think it needed the Internet? In 1990, did your company think it needed cell phones? In 1980, did your business think it needed computers? In all three cases, the answer is almost certainly no. Yet, today, no company could imagine conducting business without any of these technologies.

So does your company need RFID? Almost certainly, the answer is yes—but until you have the technology, that will not be abundantly clear. That's because businesses have to accept inefficiencies in their business until a new technology comes around, enabling them to eradicate it.

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