Jan 16, 2005Although RFID technology has been around a long time, the number of systems integrators that have experience deploying systems is limited. Very few companies have ever deployed a large-scale RFID system in an open supply chain environment, and no company has experience deploying an RFID system based on the Electronic Product Code (EPC) technology developed by the Auto-ID Center.
Companies that are planning a deployment within the next 12 months need to begin evaluating systems integrator now. There are a limited number of skilled RF engineers, and demand for their services is growing rapidly, now that companies such as Albertsons, Metro, Target, Tesco and Wal-Mart—in addition to the U.S. Department of Defense—have announced plans to deploy RFID in their supply chains.
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There are different types of systems integrators. To choose the one that will work best for your business, it’s important to evaluate your company’s needs and situation. Asking the integrators you are considering the following 10 questions will help ensure that you make the best choice.
1. What hardware have you integrated successfully?
Typically, it’s a good idea to choose the hardware you want to use before choosing the systems integrator. That way, you won’t get locked into a particular hardware vendor, because it’s the only hardware the systems integrator is familiar with. Some integrators work exclusively with one hardware vendor. Others have experience deploying hardware from a handful of companies, and still others offer to integrate any hardware that you would like to deploy.
Well-established hardware vendors, such as Intermec, Texas Instruments and Philips Semiconductors, have partner programs and can recommended a capable systems integrator. If you are not sure which hardware is the right option, a consulting company, such as ePC Group, which doesn't sell any hardware, can provide an objective analysis.
When it comes to deploying EPC technology, the choice of which systems integrator to use becomes even trickier. EPC technology is so new that all the network components aren't fully fleshed out. There are no certification programs that people can take to learn how to install an EPC system. The best option for midsize companies is to consult with the vendors that sell EPC tags and readers or to look for integrators that have taken EPC-related training (the Auto-ID Center ran an extensive one-week course last summer).
Major multinational companies would do well to turn to Accenture, IBM Business Consulting Services or other large integrators. These companies can manage large projects and will partner with hardware companies that sell different kinds of RFID technology. Another option is to go with Tyco-Sensormatic or Checkpoint Systems, two companies that have well developed service organizations that integrate electronic article surveillance systems. Although the EAS companies don't have the depth of business consulting skills that the traditional consulting and systems integration firms have, they do have a wealth of experience deploying RF-based systems.
No RFID systems integrator does everything. In general, most fall into one of three categories. Some are experts in deploying automatic identification systems, including those that use bar codes and/or RFID. Others are general supply chain integrators with experience in deploying supply chain management hardware and software. And still others are general IT systems integrators. Companies in this last group may be good for integrating RFID data with your backend systems, but may not have the RF engineering skills to deploy readers, or the understanding of auto-identification systems.
Some projects will likely require more than one systems integrator. For instance, a company might hire one integrator to evaluate tag suppliers and install RFID readers throughout its warehouses and distribution centers. It might then use another to integrate the RFID data from those readers with backend systems. The drawback to this approach is that it's easy to lose control of the project, because each integrator can blame the other for problems. If your company chooses to work with two integrators, make sure the lines of responsibility are clearly drawn.
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3. How much experience do you have in automatic identification and data capture?
RFID is essentially a data-capture technology. There are integrators with a great deal of expertise in bar codes, RFID and other technologies. If your project requires integrating bar codes and RFID tags, or if the main issue is deploying hardware—readers, wireless LAN hubs and so on—it might be best to choose a company that has a long history of working with data-capture systems.
Some integrators have developed their own auto-ID applications, which may or may not work with a high-volume RFID system. If the system is proven to handle heavy data traffic, that could save your company the time and effort of building RFID applications.
Integrators with deep auto-ID experience will also be able to assist clients in choosing the right frequencies and protocols for different RFID applications. And they will understand all the components a project will require. The last thing any company wants is to deploy technology from one vendor only to find that the project requires handheld readers and there isn't a reader that works with the system chosen.
4. How much industry knowledge do you have?
Deploying RFID requires companies to change their business processes in order to achieve savings, boost efficiency or increase sales. But processes used in the auto-industry are far different from those in the consumer packaged goods industry. A systems integrator with an understanding of a client's industry will be in a much stronger position to help the company develop new business processes. An integrator can also bring clients together to develop joint pilots to determine the benefits of using RFID in an open supply chain. Accenture, for instance, has formed a pharmaceutical industry group to help manufacturers, distributors and pharmacies work together to develop the right infrastructure for that industry.
There are other aspects to deploying an RFID system where deep domain knowledge could be helpful. For instance, tagging products in the aerospace industry can be tricky because many of the parts are made of metal, which reflects radio waves. Products made from carbon and other materials in the aerospace industry can absorb radio waves, making it difficult to read tags on these products. Vials of pharmaceutical drugs and other projects may also require specially designed RFID tags.
Large consulting companies, such as Accenture and IBM Global Services, have staff with both technical skills and business consulting knowledge. They are able to help companies evaluate the potential return on investment from an RFID system and recommend changes in the company’s business processes so it can achieve that return. Many smaller integrators don't have business consultants and can't begin to do the business analysis.
Companies should also consider hiring a separate company to do the business case analysis. One benefit of this option is the consulting firm is likely to give you a more realistic assessment of the benefits if it is not actually going to deploy the system. But the problem with this approach is that a business consultant might not understand the limitations of RFID technology and build a business case on applications that can't be deployed in the real world. If you go this route, make sure you choose a business-consulting firm that has experience evaluating RFID projects.
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6. Do you have test facilities set up to test my products?
RFID is not a one-size (or one-tag) fits all technology. Products with metal and water can be difficult to tag. That means that everything from meat to canned goods is a problem in the consumer products goods industry. With the exception of perhaps textiles, many other items pose potential problems. In order to meet read accuracy requirements—Wal-Mart wants 100 percent accuracy for cases traveling on a conveyor at 540 feet per minute, regardless of orientation—companies will need to test the best places to put tags on their products.
Some systems integrators have built or rented facilities equipped with dock doors, conveyors, warehouse shelving and so on. They have purchased tags and readers from a variety of vendors, and they can test the best options for a particular company's product. If your company is considering hiring a systems integrator that doesn't have such facilities, ask how it intends to test tags on your company’s products under real-world conditions.
7. Is your platform based on industry standard technology?
Many systems integrators have developed their own middleware platform, which they use to tie disparate applications together. Accenture, for instance, has a Silent Commerce platform that is built on Microsoft's platform. IBM uses its WebSphere middleware, and Sun Microsystems has a Java-based middleware called EPC Event Manager. If your company chooses a smaller systems integrator, be sure that its middleware platform is open enough to link with all of your enterprise systems. Otherwise, you will wind up paying for a lot of custom coding as the integrator develops application program interfaces.
Even if your company chooses a systems integrator with a robust middleware platform based on a well-established architecture, the chances are that the project will eventually require some custom coding. That's because RFID is so new and there are few off-the-shelf products designed to link RFID readers to backend systems. Even if you purchase a "concentrator" that takes data from readers and turns it into XML format, your integrator will need to figure out how to get the data into the right systems automatically. This is a challenge.
Many large companies, particularly those that have grown through acquisition, will have a variety of enterprise resource planning systems and enterprise applications. In most cases, these systems will not be able to simple take an XML data feed. The RFID data needs to be formatted and then routed to the appropriate systems. This will require custom coding based on the types of backend systems a company has and the business processes that are being automated.
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9. Who owns the intellectual property?
In many cases, companies will work with their systems integrators to develop entirely new RFID solutions. Both the company and the integrator will likely contribute significant intellectual property toward developing the system. The question is: Who owns the intellectual property? Will your integrator be able to turn around and sell the system your company helped to develop to one of your competitors? Or will your company be able to create a consulting service based on its learnings? It’s important to work out these issues before a major project is undertaken. Your company may even be able to negotiate a discount on the integration work in exchange for allowing the integrator to sell the solution to others. Just be sure to have your lawyers work in a clause that says they can't sell it to your closest competitors.
10. Do you have a vision for how to build on the system?
RFID is one aspect of a much larger supply chain IT system. As wireless sensors and transceivers that work with the Global Positioning System come down in price, companies will want to build on the real-time auto-identification system that they create for RFID technology. Systems integrators need to have a vision for how that architecture might evolve and what a company's needs will be, so they can develop the RFID infrastructure as a platform that can be added to and enhanced over time.
No systems integrator will be able to address all of a company's needs, so each company will need to make some compromises in its choice. The key will be to understand your needs and what potential integrator partners can provide. In the end, any successful RFID project will depend on choosing the right partners, so it pays to spend time asking the right questions.