Feb 01, 2012Perhaps the question I am asked most often is, "If RFID technology is as wonderful as you say, how come everyone isn't using it?" It's a good question, and the answer is complicated. There are psychological reasons: People are resistant to change. There are financial reasons: The economic downturn left companies with fewer resources to invest in new technologies. There are technical reasons: Until recently, RFID was not always reliable enough for some applications.
The technology has made a great deal of progress over the past few years, and in many applications, RFID is delivering significant benefits. For it to achieve widespread adoption, the last few pieces of the puzzle need to be put in place. One piece is data integration. Most existing IT systems don't handle serialized data or real-time data (or near-real-time data).
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Our cover story reveals how to integrate RFID data into existing back-end systems (see Cover Story). RFID is all about data, so it's essential to get this part of your deployment right. Getting data integration wrong is like tripping just before reaching the finish line in a race.
One key strategy is to focus on standards, which enable all your applications to use RFID data. It also will allow your company to share RFID data with supply-chain partners when they adopt the technology.
Another important strategy is to ensure your data is "clean." Often, companies have different master data files for the same product, in external repositories and within their own systems. That can happen if, for instance, a company manufactures an eight-ounce bottle of perfume, and then introduces a six-ounce version—but doesn't update the product description in all enterprise databases. Problems with bad data only intensify with RFID, because more data is being collected and shared.
To implement these and other data-integration strategies, create a team that focuses on these issues. Since the goal is to integrate RFID data with enterprise applications, be sure to include representatives who understand the technical requirements and the business needs.
The U.S. Department of Defense (DOD) has been dealing with RFID data-integration issues for more than 20 years, since it first began deploying its "total asset visibility" solution. Today, the DOD, which runs the largest and most complex supply chain in the world, employs active and passive RFID technology to track myriad assets worldwide. It has improved efficiencies by sharing data among many units, and is striving to further improve business processes and reduce costs (see Vertical Focus).
But the DOD faces economic challenges, as the federal government's budget deficit is forcing spending cuts. RFID can help the DOD do more with less, but leaders in Washington must have the vision to see the long-term benefits, so they don't cut RFID programs to achieve short-term savings. In fact, that's true of all companies. RFID is an expense in the short term, but the technology will deliver big savings down the road—provided you get the integration piece right.
