Where the Benefits Are
From receiving and warehouse management to yard management and shipping, here’s how RFID is helping five companies save millions.
By Bob Violino
Jan. 1, 2004—If you’re struggling to develop a business case for deploying RFID technology and all you see are huge costs, you’re thinking too narrowly. RFID is a lot more than a technology that can improve order accuracy or reduce the amount of time spent scanning bar codes in the warehouse. As you wonder about the potential return on investment, keep in mind that RFID is a platform you can use to make your organization more efficient in many different ways in many different areas.
Think of the Internet. If you had tried to justify your investment in routers, switches and Ethernet cable by finding a return on investment from sending e-mail over the network, your company still wouldn’t be wired today. Yet the Internet makes almost every part of every business more efficient—from research and development to accounts receivable. And so it will be with RFID.
No company has RFID-enabled their operations from end to end. But many companies, including the five we profile here, have proved that lower costs and higher productivity can be achieved with RFID in key operational areas. That’s why it’s so critical to create a cross-functional team (see “A Mandate for Change,” page 18). Keep in mind that your company may not get the same benefits Boeing or Procter & Gamble got in one area, but you may achieve greater benefits in another. Each company has to find and focus on where it will get the most return on investment. See “Five More Ways to Save” on page 27 for additional ways to reap rewards from RFID.
Jan. 1, 2004—If you’re struggling to develop a business case for deploying RFID technology and all you see are huge costs, you’re thinking too narrowly. RFID is a lot more than a technology that can improve order accuracy or reduce the amount of time spent scanning bar codes in the warehouse. As you wonder about the potential return on investment, keep in mind that RFID is a platform you can use to make your organization more efficient in many different ways in many different areas.
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Think of the Internet. If you had tried to justify your investment in routers, switches and Ethernet cable by finding a return on investment from sending e-mail over the network, your company still wouldn’t be wired today. Yet the Internet makes almost every part of every business more efficient—from research and development to accounts receivable. And so it will be with RFID.
No company has RFID-enabled their operations from end to end. But many companies, including the five we profile here, have proved that lower costs and higher productivity can be achieved with RFID in key operational areas. That’s why it’s so critical to create a cross-functional team (see “A Mandate for Change,” page 18). Keep in mind that your company may not get the same benefits Boeing or Procter & Gamble got in one area, but you may achieve greater benefits in another. Each company has to find and focus on where it will get the most return on investment. See “Five More Ways to Save” on page 27 for additional ways to reap rewards from RFID.
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