A 600-bed hospital managed by the Mayo Clinic was among the first to calculate and publish the results of an ROI analysis of RFID in a healthcare setting. The final number was impressive: 327% ROI over the first three years, with break-even at less than a year.
But maybe your organization isn’t in the healthcare business. You manage a professional services company, a manufacturing business, a museum, or a retail store. How do you calculate RFID’s ROI when your operations are quite different from a hospital’s operations?
ROI calculations, at their most fundamental, start with questions.
What items are vital to your operations? Answer very specifically (e.g. “33 laptop computers with 16 gb of storage,” rather than “computers”). These items can be operational elements, or manufactured products, or a combination.
Visibility: How many times per day/week/month does an item go missing? How often are you short on supplies?
Intrinsic value: What does the loss of an item cost – not just the hard cost, but the cost of intangible added value? Artwork or data are examples.
Management costs: What is the cost of periodic inventories or audits to maintain operations?
Ancillary costs: How much income is lost due to down time when an item is missing or lost, or supplies run low? Are there costs associated with regulatory fines for lost items? How do inaccurate inventories in one department impact other departments’ finances?
With these numbers in hand, calculate two cost scenarios. One scenario is for existing conditions. The other includes the potential improvement to visibility provided by RFID. Most RFID users see visibility (loss) improvements of 60% or better.
But to truly calculate ROI, we have to project the potential savings over an extended period, usually 3 to 5 years. The Net Present Value (NPV) formula gives the most realistic ROI projections for RFID. The NPV formula shows whether the benefits outweigh the costs.
If you manage finances for your organization, you’re familiar with NPV. If you work in a less math-intensive department, you might find an NPV calculator useful. Either way, the answer will give you a strong indication of the wisdom of an investment in RFID. We’re quite confident you’ll be pleasantly surprised by the outcome!
The ways we were accustomed to work were blown up by Covid-19 and the ensuing economic disruption. The 9-to-5 forty-hour work week now is the self-scheduled WFH get-the-job-done week. Surprisingly, productivity and employee satisfaction have risen dramatically in response.
However, corporate culture may be suffering. Businesses in which mentorship and hands-on training are particularly affected. From construction trades to consulting and sales organization, corporate culture relies on in-person interactions. Executives are announcing return to the office policies effective in the near future.
Still, concerns about surging Covid variants are making staffers reluctant to spend much, if any, time in the office. Facilities managers are asking if there’s a way to protect employees in the office setting without adding costly space to accommodate health protocols.
Here are three ways to help keep in-office teams safe without expanding the office footprint:
Convert paper documents to digital documents via digitization, and reduce your document storage area. Imaged documents are productivity boosters, whether staffers are in the office or working remotely. And many of the imaged documents do not need to be retained as paper, freeing up room for social distancing and proximity barriers.
Exchange traditional filing cabinets for a high-density filing system, and save as much as 50% of your storage floor area. While digitization will reduce the need for much document storage, some paper docs need to be retained. Keep them in a high-density filing system and save even more space.
Add touchless smart lockers that guide in-office traffic while enhancing design aesthetics. Employees need secure storage for personal items in the office, and smart lockers provide touchless operation. Their customizable finishes make them a design feature, and they can be set up in work areas to provide separation and guide traffic without requiring additional space.
Security experts Kastle Systems report fewer than 28% of employees in the office in the first week of January 2022, in 10 major U.S. markets. Morning Consult’s survey shows 55% of employees being unwilling to return to the office if they felt unsafe. With the above ways to provide worker safety, your business can encourage a return to work without the added overhead of increased real estate costs.
If you’re responsible for your organization’s accounting, you know how stressful the new year can be for your accounting team. Inventory and asset valuations, year-end reports, W-2’s, all on top of the usual day-to-day tasks – it’s a lot to deal with in a very compressed time frame.
And because you’re good at your job, your CFO has high expectations for speedy and accurate reporting. But when staffers are over-stressed and overworked, they make mistakes. Those errors can be time-consuming to find and costly to fix, especially when financial reports and tax filings are involved.
Much accounting work is automated: Pull up a spreadsheet, press a few buttons, get an answer. But when it comes to the items a business uses internally (furnishings, equipment, etc.), producing a report can be far more labor intensive and far more error-prone. The quantity, condition, and location of assets can’t easily be determined by the click of a button.
Or can it be that easy?
RFID brings speed and accuracy to your asset accounting. RFID tags can be attached to fixtures, furnishings, equipment, even intellectual-property documents. Using a combination of handheld RFID readers and doorway RFID readers, assets’ locations are tracked automatically:
Computers and peripherals
More than just location and quantity, the RFID tag can carry information about:
An asset’s age and its acquisition cost, for depreciation
Its maintenance calendar, for replacement cost analysis
Its frequency of use, for redundancy reports
Dozens of other data points can be included, all of them relating to an asset’s value.
And this wealth of information is available in real time, for ad hoc reports, quarterly reports, or annual reports, with the click of an RFID reader button. Accurate, reliable data on the contents of a box or a room goes instantly to the RFID software, where it can be compiled into a report or integrated into your accounting software.
Here’s how fast and easy it is:
Manual tasks like hand counts and document filing aren’t just time-consuming; they are especially susceptible to errors. Implement an RFID system, lose the mistakes, and gain time for your other accounting assignments. Your CFO will love you for it!
The future is filled with unlimited possibilities. To some, the prospect is exhilarating. To many others, the notion of unlimited possibilities is paralyzing. It seems the frontal lobe of the human brain, which is responsible for comprehending time and space, simply can’t come to grips with the idea of infinity. Business forecasts are filled with conflicting data and contradictory recommendations.
That’s why limits and boundaries are so necessary to human societies. With that in mind, we’d like to offer some guidelines to help you embrace tomorrow and get excited about the possibilities – within limits.
Efficiency – While outer space may be infinite, productivity can be restricted by lack of access to data. When information is confined to paper documents, collaboration is slowed down. A database of imaged documents gives teams immediate access to data, whether teams are co-located or working remotely.
Technology – From manufacturing to logistics to retail, RFID has been increasingly improving throughput. Some experts even credit RFID with salvaging the future of brick and mortar retail, using automated inventory management to support curbside delivery and enhance the customer buying journey.
Adaptability – One thing we’ve learned from the pandemic: Flexibility is vital to a business’s survival. The hybrid office is here to stay, and today’s office environments must be able to pivot swiftly as in-office workforces fluctuate. Architectural glass and smart lockers help with contagion control, and imaged documents support hybrid workflows.
Planning – A solid plan defines your path forward into the unknown of the new year. If disaster strikes, a sound disaster recovery plan includes storage technology considerations for logistics, documents, and key assets. A proactive plan helps you prepare for any eventuality. You manage change instead of letting change manage you.
While you can’t predict what tomorrow will bring, you can certainly set goals and establish roadmaps for the months to come. And you can take comfort knowing that you don’t have to go it alone. Reach out and partner with professionals who can help you along your path. The unlimited possibilities of the future will change from intimidating to energizing.