Jan 19, 2004When I launched RFID Journal two years ago, many people said to me: "You've really found a tiny niche for yourself." I would smile politely, but in my mind I would be thinking: "RFID won't be a niche technology for much longer." Strolling around the show floor at the National Retail Federation Conference & Expo in New York
last week, I couldn't help but think RFID has either become a very big niche or it's on the cusp of becoming mainstream. The technology was everywhere.
The Metro Group, Germany's largest retailer, had a pavilion that covered more acreage than your average Texas cattle ranch. It contained smart shelves, smart shopping cards, self-checkout centers, kiosks for killing tags and a lot more. What impressed me the most was the constant stream of interested exhibition-goers taking guided tours of the pavilion (I guess the guides were to ensure no one got lost).
A wide array of technology vendors showed off new RFID products, including, Checkpoint Systems, Intermec and Symbol. And a gaggle of companies announced new RFID hardware, software and service offerings, which we covered in last week's newsletter.
As pleased as I was with all the focus on a technology I have long been convinced would become important to the global supply chain, I felt a sense of unease. Lost in all the excitement was the fact that deploying RFID technology successfully is hard and involves a lot more than installing RFID readers and slapping tags on cases.
Well, it wasn't completely lost. I had a chance to sit in on a session about global data synchronization, which featured Jeremy Hollows, director of B2B for Carrefour, the big French retailer, and James Jackson, vice president of strategy for Unilever, the Anglo-Dutch consumer products companies. Both gentleman stressed that you can't even begin to think about implementing RFID in your supply chain until you've spent time cleaning up your item vendor master files—the product catalog that includes information related to specific products, including Universal Product Codes, EAN numbers, product class, weight, and so on. (UCCnet, the retail and consumer packaged goods industry's product registry and information exchange service, requires more than 60 data elements.) Eventually, the master file will include Electronic Product Codes.
Today, the master file is used by retailers mainly for procurement, warehouse management and replenishment. In the future, it will be critical to the sharing of EPC data among retailers and suppliers. The EPC serial number will be associated with this product data, so it will be used to automate many routine tasks, such as sending advance shipping notices, receiving goods, updating inventory and generating invoices.
Studies reveal that 30 percent of the data in most master files is inaccurate, due to lack of standardization, human error and so on. "Most manufacturers don't realize how bad their data really is," said Hollows. Jackson agreed. "We spent 18 months scrubbing our data, which was 14 months longer than we expected," Jackson said. "If you want to do the fun stuff of deploying neat new technologies like RFID on the front end, then you have to roll up your sleeves and start cleaning up your data on the back end."
This is tedious work. But both Hollows and Jackson said their companies were thoroughly convinced that there is a return on investment in doing it. Improvements in order accuracy and other benefits more than offset the cost of insuring that you have the right information. That's reason enough to do it, even if you aren't going to deploy RFID any time soon. But if you are, it's critical. Said Hollows: "If you don't do global data synchronization before you do RFID, then you are just going to have a bigger data problem on your hands."
This kind of grunt work doesn't get shown off in big glitzy pavilions at trade shows. And I've never seen a magazine give away an award for cleanest master file. The data synchronization session wasn't as well attended as a panel discussion hosted by Intermec. But if companies are going to use RFID technology to save money and boost efficiency, they not only have to deploy the right tags and readers; they have to get the back end piece right as well.
Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below.
Correction: An article published on Dec. 29, 2003, stated: "The HAG recently submitted a proposed specification for the new protocol to EPCglobal's board." This is incorrect. According to EPCglobal, a draft specification begun under the auspices of the Auto-ID Center has not been submitted to the board. Work on it will resume under EPCglobal when EPCglobal and RFID vendors agree on how to manage intellectual property that goes into the specification. Then the draft will be submitted to the board. The story has been corrected. We regret the error.