Appendix C
Realizing the Benefits of an RTLS
In This Appendix
Assessing the benefits of using an RTLS
Creating a benefits realization report
Before you invest in an RTLS, it’s critical to quantify added business value along its three dimensions of how much, how soon, and how certain. Only then can you justify the expense.
The key to assessing how much and how soon your investments will pay off is to set expectations and define measurements at the beginning, and the key to assessing certainty is understanding the possible risks.
This appendix shows you how to create fact-based benefits realization reports so that you can build a compelling business case to justify investments in an RTLS.
Assessing Benefits
Return on Investment (ROI) is used more or less as a generic term to define the business value of an investment. Classic ROI is the ratio of the net gain from the investment divided by its total costs. Classic ROI has appeal because of its compelling simplicity; however, different companies and people use a variety of metrics to measure ROI:
Classic ROI: To calculate classic ROI, the benefit (or return) of an investment is divided by the cost of the investment; the result is expressed as a percentage or a ratio.
% ROI = [(Gain from investment – cost of investment) ÷ Cost of investment] × 100
Keep in mind that there isn’t one “right” calculation for classic ROI — it can be manipulated easily to suit the user’s purposes, and the result can be expressed in many different ways. ...
