European Companies Seize the RFID Opportunity

By Mark Roberti

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European governments have played a major role in the development and deployment of radio frequency identification technologies. The European Union has sponsored projects to help businesses understand the value of RFID, and public-sector applications, such as library and transit fare-collection systems, have improved services for millions of people. Now that RFID has proved its mettle, private companies across the continent are turning to the technology to help them weather the global recession.

In this issue’s cover story, contributing writer John Edwards examines how companies in myriad industries—including construction, manufacturing and retail—are adopting RFID to reduce costs and stay competitive (see The Great Recession Spurs RFID Adoption in Europe). Their immediate goal is to survive the recession by developing business cases that deliver a fast return on investment. They are not focused on one type of RFID technology; instead, they are choosing the application that best suits their needs, whether it’s managing materials, improving inventory accuracy or lowering labor costs.

The longer-term goal is to position the companies to grow rapidly as the economy improves and steal a march on competitors from within Europe and around the world. “The best time to do these types of projects is now, getting yourself a competitive advantage for the future,” Matthew Preston, IT director for the Byrne Group, a U.K. construction company, told Edwards.

Hospitals were under pressure to reduce costs even before the recession, and now the pressure is even more intense. As Elizabeth Wasserman reveals in this issue’s Vertical Focus, many are turning to active RFID systems to better monitor assets. By knowing exactly where every oxygen pump and gurney is, hospitals reduce the amount of time employees spend looking for mobile equipment.

More important, by increasing equipment usage rates, they reduce the number of assets they need to buy, thereby decreasing annual capital expenditures. The University of California, San Diego Medical Center estimates that since it deployed an RFID-based real-time location system in 2006 to track assets at its Thornton, Calif., campus, it’s saving about $90,000 annually on IV pumps alone (see Health-Care Facilities Embrace RFID).

Increasingly, food producers and shipping companies are considering the use of RFID tags with temperature sensors to monitor perishables and refrigeration units. The tags can automate data collection, reducing labor costs, and provide more timely information, so steps can be taken to reduce losses from spoilage. In this issue’s Product Developments section, we tell you what you need to know about RFID temperature sensors. We explain the difference between battery-assisted and active tags, and give you the ins and outs of the various sensor standards (see A Guide to Sensor-Equipped RFID Tags).

It’s not clear when the global recession will end. But it is clear that the smart companies—in Europe and around the world—are deploying RFID technologies to survive the tough economic times and prepare for better days ahead.

Photograph: Tom Hurst