When the American public learned on Sunday that Osama Bin Laden had been killed by an elite unit of Navy SEALs, the country had much reason to celebrate. Since 9/11 our country has endured the high costs of terrorism that occurred on our soil. Not only did we lose thousands of lives, but New York’s economy lost millions of dollars in 2001 alone. The war on terror has created opportunity costs that are associated with any war – the funds that are allocated to military operations are dollars that are not spent elsewhere, such as on education or health care. Our government considers these opportunity costs when making decisions about our priorities and about which investments would benefit us the most.
In business, as in government, we must consider opportunity costs when we make decisions. When we invest in any area, such as in a new technology, we look at the return on investment (ROI), but we should also look at the opportunity costs that would be incurred should we not make the investment. For example, we know that meeting face-to-face is the preferred form of communication in most situations. When we see the other person we can gauge reactions and relate better to each other. When we must meet with other parties remotely, an audio call will simply not deliver the same quality of experience as an in-person meeting, and we are at a disadvantage. When a company has not invested in video conferencing, the opportunity costs of this decision are numerous – a reduction in efficiencies, decreased quality of communication and an increase in travel costs (compared to those organizations using video), and delayed product time to market, among others.
According to most trade reports the video conferencing market place is growing and will be at least a $5 billion industry in the coming year. The opportunity costs of not utilizing video when the competition is will be high.