CC-03-148 Moving the Clock Forward: The Economic Value of Improved Plant Information

Description:

What is the value of information? More particularly, how do we quantitatively evaluate a potential investment that will provide improved information about the current and past state of a process plant? Such potential investments might include real time historians and other databases, “smart” instrumentation, improved data analysis software, and/or improved user interfaces. That this information has value is widely accepted. However, quantifying the value is difficult. Quantification is important if we are to make rational economic decisions about the correct level of investment for these technologies. In this paper an economic model is proposed for estimation of the value of information investments based upon their effect upon the decision process in the plant. This model leads to quantitative estimates that have a realistic financial basis. An example is presented showing how the method can be applied for a typical investment.