The Year of Value-Driven RFID Deployments

Dec 20, 2010Each year for the past nine years, I have written an end-of-year column that attempts to sum up the previous 12 months. It's hard to boil an entire year's worth of news stories down to 750 words, but my overriding feeling about 2010 is that it was a year in which there were many successful deployments of radio frequency identification. And the reason they were successful is that they were driven by the need to solve real business problems, or to create real business value.

Three recent news stories illustrate my point:

• Medtronic is employing an RFID solution, developed in-house, that enables personnel to determine the locations of oscilloscopes, meters and other devices, and to document any items that leave the labs, as well as which personnel took them (see Medtronic's Labs Use RFID to Track Down Tools).

• NASA's Langley Research Center is using passive RFID tags to identify equipment and its location, enabling the agency to reduce the time employees spend taking stock of equipment, from three weeks down to a single day (see EPC RFID Simplifies Inventory for NASA's Langley Research Center).

• Berry producer Driscoll's is utilizing a combination of RFID sensors, GPS and cellular communication technology to ensure that its products are transported at the proper temperature, and that trailers are not opened during transit (see Driscoll's Monitors Its Berry Shipments in Real Time).

These stories represent three very different types of deployments in three separate industries, but the common theme is that in each case, the technology is being used to improve operations.

The two areas in which RFID is receiving the most attention are apparel retail and health care. Hospitals and clinics have achieved some impressive savings on rental equipment and capital expenditures by employing active RFID-based real-time location systems (RTLS) to increase asset utilization. Hospitals have also deployed systems to improve safety (see Innsbruck University Hospital Finds Safety Through RFID), manage patient flow (see Apollo Hospital Chennai Uses RFID to Speed Up Check-ups), and track the temperatures of refrigerators and freezers that store pharmaceuticals, tissues, blood and food (see Belgian Hospitals Track Temperatures and Staff).

In addition, apparel retailers have realized that RFID technology is ideal for managing complex inventories. By taking inventory of tagged items more frequently, retailers can spot when a specific size, color or style is not on the shelf and replenish such items more effectively. This increases revenue, because retailers are able to sell more goods at or near full price. To see how effective RFID is in this regard, view a video I filmed at an apparel store in Italy: Using RFID to Take Inventory in an Apparel Store.

In July 2010, Wal-Mart Stores announced it was using RFID to track jeans and men's basics (see Relaunches EPC RFID Effort, Starting With Men's Jeans and Basics). Several other rollouts are underway as well, and the industry has come together, through VICS, GS1 Canada and GS1 US, to promote adoption in a way that benefits retailers and apparel suppliers (see Major Retailers, Industry Groups Launch Item-Level RFID Guidelines Initiative).

What's encouraging is that for many companies, RFID is no longer a science experiment. It's an automatic-identification tool that provides visibility into the locations of specific individuals, assets, equipment, tools and vehicles, and this visibility enables them to better manage these things. In my next column, I'll make some predictions for the year ahead, but one thing seems obvious: Early adopters have proven the business benefits of RFID in many areas, which means fast followers have an opportunity to benefit now.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog or the Editor's Note archive.