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RFID: The Key to Knowledge

Early adopters are learning that visibility—one of the main reasons companies adopt RFID—leads to the creation of actionable business information that can boost the bottom line.
By John Edwards
Feb 21, 2011—Most companies considering deployment of radio frequency identification systems today are focused on basic visibility: the "what," "when" and "where" of pallets, cases and items. But early adopters are learning that RFID also adds the "why" and "how" to the information pool, transforming the technology from a relatively simple tracking and tracing tool into a powerful knowledge-gathering resource. As RFID vendors and adopters continue to stretch the visibility envelope by designing and deploying ever more innovative systems, they're discovering the technology's value as an increasingly steady and reliable source of high-quality business data.


RFID's ability to deliver intelligence directly from the source is what makes it a particularly valuable knowledge-gathering tool, as well as a good investment. "There is such a thing as too much data, but there's no such thing as too much good data," says Russell Klein, a vice president at Boston-based Aberdeen Group, a technology market research firm. "You can spend $5 million upgrading your ERP [enterprise resource planning] system, but that doesn't give you better information."

Companies that fail to perceive the value of RFID business intelligence risk falling behind the competition, says John Ryan, administrator of the Hawaii Department of Agriculture's quality assurance division, which is evaluating whether RFID-generated environment intelligence can be used to optimize produce transport. "The ones that are successful and stay ahead of the game are the ones that don't wait for the hammer to come and hit them on the head," he says. "They're the ones who are curious about the technologies that are available."

There are two basic approaches to getting operational efficiency or better performance from RFID-driven business intelligence, Klein says. "One is to identify a problem, and then use the data to validate the problem and identify an opportunity for optimization in the business process," he says. "The other is to approach the data without a preconceived notion of what you hope to find, and discover opportunities for improvement."

Today, enterprises across a wide array of sectors, including manufacturing, retail and health care, are adopting one or both approaches, employing RFID's ability to deliver actionable knowledge and insight into complex situations.
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