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Fear of RFID

The theories presented in the book "Freakonomics" might explain what is preventing more CEOs from embracing RFID and other new technologies.
By Mark Roberti
Could the same be true of RFID? Could it be that CEOs are familiar with certain types of IT projects but are unfamiliar with RFID, so they choose to take on one type of project instead of embracing RFID, simply because they don't understand the potential risks or rewards?

The authors write that "fear best thrives in the present tense." They note that a bureaucrat charged with securing funds to fight one of two killers—terrorist attacks or heart disease—would have far more success getting money from politicians to fight terrorism than they would to combat heart disease, even though far more people will die of cardiac problems. This, they conclude, is because a terrorist attack could potentially occur right now, whereas heart disease might kill people quietly at some point in the future.

CEOs might not admit this, but we are motivated by fear. If you are the founder and primary shareholder of your company, as I am, then you fear losing everything you worked so hard to build. If you are an appointed CEO, you are probably afraid of losing your salary, perks, social prestige and so forth. So faced with the question, "Would you rather risk losing your job now by investing in a new technology, such as RFID, or risk losing your job in the long term because your company is less efficient than its competitors?" you would likely choose to lose your job at some point in the future, after a long, slow slide.

Fear also explains why the herd follows early adopters after they reach critical mass. Press reports start saying that companies are adopting a new technology, and suddenly, the CEO no longer fears losing his or her job for being too far out in front, but instead for being too far behind. Concerns about achieving a return on investment, as well as other roadblocks thrown up, give way to a sense of urgency.

I'm sure most CEOs would say this is not the case, but I believe it is so. And in spite of all their talk about innovation, they fear losing their jobs over an ambitious bet on new technology. This, of course, is no way to manage. You should invest in a new technology like RFID when it can deliver value—and because it will deliver value. That should be the primary, if not sole, motivator.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.


Jay Oza 2011-09-20 05:56:58 PM
Excellent article When some is scared they don't make a decision or a wring one. It is up to the RFID vendor to make the customer comfortable. We ran into this with a large customer, but slowly we were able to make them comfortable with the technology and jointly developed a solution for their needs. It is being done, but you gotta to know how. That is the challenge. I have found RFID very easy to sell, if done with business in mind and mimic the customer's language.
HRAFN AS HRAFN 2011-09-21 09:32:00 AM
Excellent article and comment. I totally agree. By focusing on business, and explaining RFID is off-the-shelf technology, the sales can be done. Another effect I like to see is when it turns out the customer actually have RFID tags in daily operation in advance. One only have to talk about how existing RFID infrastructure (e.g. rfid on the pallets), can be creating value for the customer, instead of having to discuss investing in tag-infrastructure. I believe there will be more of these meetings comin up, as the RTI industry is adopting the technology at faster and faster pace. Geir Vevle. CTO HRAFN

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