Jul 19, 2015Every year at RFID Journal LIVE!, I visit the RFID solution providers in the exhibit hall to see what new software products they're offering. This year, software innovation was even harder to find than last year. For the most part, software is designed for sector-specific applications, such as asset tracking for aerospace, manufacturing or oil and gas. This is well and good for the early stages of RFID adoption, because each company no longer has to develop a custom solution.
But early adopters are now moving beyond using RFID as a point solution to automate a single business process. They—and, increasingly, their business partners—are collecting (or have the potential to collect) a massive amount of data, and they need software that can harness that data to extract business intelligence and make new processes possible.
Take the apparel retail industry, for example, which, by all accounts, is the first sector likely to reach the tipping point, perhaps as early as next year. Retailers are using item-level RFID to improve inventory accuracy, to ensure products are on the shelves when customers want to buy them. Recently, the move to omnichannel retailing—the ability to shop anytime, anywhere—is propelling more companies to adopt RFID. At the same time, retailers are asking suppliers to tag items at the point of manufacture.
But for the most part, RFID tags in stores are read only when retailers are counting inventory, and the data is discarded as soon as the inventory is counted. This eliminates a tremendous opportunity to get true visibility into the supply chain—the ability to track items, individually and in real time, from manufacture to distribution centers and then to each store.
If companies could collect, store, share and analyze this data, it could transform their businesses. Instead of using RFID just on a local level, a retailer that was aware that Store A was running low on Item X could divert a shipment en route to Store B, and then submit an extra order to the supplier to replenish Store B. Or a manufacturer could see in real time how a promotional item is selling in different parts of the country and, perhaps, combine that with weather data to understand why.
Companies need visibility across the enterprise and in the supply chain, not just in individual stores or factories. But collecting and managing all that information is a "big data" issue that requires software. The software must enable businesses to securely share data with trading partners and carry out large-scale analytics in real time to generate business intelligence.
This is the future of RFID software. I hope next year I can report it's on display in the exhibit hall.
Ken Traub is the founder of Ken Traub Consulting, a Mass.-based firm providing services to companies that rely on advanced software technology to run their businesses. Send your software questions to swsavvy@kentraub.com.
