ABSTRACT
Management engineering involvement in cost justification of capital equipment dates back decades. However, the classic techniques used for cost justification and cost-benefit analysis of capital equipment do not always apply to assessing the return on investment (ROI) and benefits of disruptive technology, especially information technology. This chapter reviews classic cost justification methods and explains why those methods may not always be appropriate for assessing the return on investment and benefit of current-day disruptive technology. The chapter proposes techniques that management engineers can use to assess the return on investment and benefits of disruptive technologies.
