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Standards Are the Key to RFID’s Value

EPCglobal will soon publish a standard for the EPC Information Services, which might not sound sexy, but it is the key to leveraging RFID in the open supply chain.
By Mark Roberti
Mar 26, 2006When I was a reporter writing about technology, I had an editor who, whenever I submitted a story about standards or mentioned them in an article, would scribble "MEGO" in the margins. That stands for “My Eyes Glaze Over.” Or, put another way: “Boring, boring, boring!”

Standards might not be sexy, but they are the key to leveraging new technologies in a global way. Proprietary technologies can help you solve a specific business problem, but they can’t be leveraged across an entire supply chain.

One of the most important stories we published in 2005 was about a standard for sharing Electronic Product Code data created by an EPCglobal working group (see Target, Wal-Mart Share EPC Data). That article was the most overlooked story of 2005, because people didn’t understand the significance of the data-sharing standards. But early adopters are now seeing the benefits.

The data-sharing standards provide context to EPC tag reads. When a retailer supplies a consumer-products goods (CPG) company with EPC data, it doesn’t just provide a raw EPC number. It also provides XML software codes to let the CPG company know whether the tag was read at a distribution center, the back of the store or the door between the backroom and retail floor.

The data is still not perfect. It needs to be cleaned. But software companies such as OATSystems, TrueDemand, TC3i and others have developed products that use this standard-format data to give companies an unprecedented level of visibility into what’s happening between the time a product leaves their manufacturing facility until it reaches the retail sales floor. Now CPG companies are figuring out how to change their business processes to leverage this incredible visibility, and once they do that, RFID will start to take off in the supply chain.

EPCglobal is close to producing the next important standard—the EPC Information Services (EPCIS) standard. This is really a set of network standards that will enable companies to use the EPCglobal Network to share data securely. It probably won’t get a lot of attention immediately, but it is significant because the EPCIS standard will enable CPG companies to share data with many retail partners at once.

Today, companies tagging goods for Wal-Mart or Target are sending the retailers advance shipping notices and receiving data back via point-to-point connections. That’s fine if only one or two or three retailers are using the technology, but as more companies adopt it, manufacturers need an infrastructure that can scale up and manage data sent to and from retail partners. The EPCIS will enable them to build that.

Standards are the key to leveraging RFID in the open supply chain. Just think about the Internet. Without HTML and other standards, it would be impossible for me to publish this story and have everyone around the world read it on their computer. The EPCIS and data-sharing standards coming out of EPCglobal could be just as powerful and just as transformational when it comes to sharing data that can be acted on by supply-chain partners. So when EPCglobal publishes the EPCIS standard, don’t let your eyes glaze over.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below.
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