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View From the Top: 5 CIOs Speak Out on RFID

The leaders who determine the overall strategic direction and business contribution of enterprise information technologies have strong views on how RFID should—and should not—be used.
By John Edwards
Feb 01, 2008—Chief information officers are the most powerful people in the RFID universe. It's often CIOs who green-light RFID initiatives involving multiple business partners—and pull the switch on global RFID projects that failed to meet expectations. CIOs also sit on RFID standards committees, identify promising technologies, work with vendors to fine-tune product and service features, and educate CEOs and other top-level executives in their companies on RFID's business potential.

Given the massive impact they have on the RFID industry, it's not surprising that most CIOs have strong opinions on the technology, including its current uses and misuses, and future prospects. For a CIO's view of RFID in 2008, RFID Journal asked five CIOs working in five key fields—manufacturing, health care, food products, transportation and retailing—to reflect on their current relationship with the technology, the lessons they've learned, and where they believe things are headed.

Getting Dow to Business
David Kepler, CIO of Dow Chemical in Midland, Mich., is a strong believer in RFID. "RFID aligns to the corporate strategy," he says, "and brings multiple benefits to the company."

In 2006, Dow launched a multigenerational supply-chain program aimed at pulling together sensor networks, global positioning systems and auto-identification technologies to improve the way the company tracks materials, both in transit and in warehouses. "Collaboration across the supply chain is required for the long-term success of everyone," Kepler says. "The establishment of the chemical industry vertical in EPCglobal and building out use cases across the industry is an essential first step. Dow's intent is to be a leader in leveraging technology for value; we are not doing this for the sake of new technology."

Dow will only launch RFID projects that have the right combination of tangible value, strategic alignment and feasibility. "We use a front-end loading waterfall methodology, and we start projects but have stage/gate reviews to ensure success," Kepler says. "We also recognize that there is risk with the emerging nature of these technologies, and we adjust our management of each project based on risk mitigation."

At Dow, RFID is already creating positive bottom-line results. "RFID has generated a 50-percent improvement in response time to identify and resolve in-transit problems, as well as a 20-percent reduction in excess product and safety stock inventory," Kepler says. Other benefits attributable to the technology include a 20-percent container fleet reduction and an improvement of up to 90 percent in the reliability of delivery-time windows, plus the elimination or early detection of product theft.

Kepler believes that standards, technology maturity and innovation will combine to drive widespread RFID adoption. "Once you have adoption for one purpose," he says, "the second set is usually cheaper from a value perspective."
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