Time again… Were you one of the cheering enthusiasts in the 2003-2005 Wal-Mart wave of RFID frenzy? Or a lurking skeptic hoping for failure and “told you so”? I was myself caught somewhere in between – certainly seeing the huge potential in the technology, but also frustrated by the then-prevailing approach that mandated involvement by so (or too) many players in the supply chain. What makes it different now?

If you haven’t noticed, RFID is rapidly being rolled out for everyday use in our road toll systems, ski lift access control etc. But adoption of RFID in supply chain has been slow and is a perfect illustration of Gartner’s hype cycle. We’ve experienced the peak of inflated expectations and then the trough of disillusionment, when only the very persistent pioneers continue to create and verify the technology. In general I’d say that with RFID we have faced challenges in many areas, of course technology and cost, but also similar issues as with ASNs (see earlier blog post on that topic); it is hard to mandate suppliers to invest in just getting compliant. So building a case on chain-wide initiatives is not a walk in the park, even with the great guidelines we get from GS1.

Luckily, time is ripe for a recipe where RFID can be a complement to other identification and information exchange technologies. Printed RFID labels have dropped in price and are marginally more expensive than normal bar code labels. As they can include RFID tag, bar code and human readable identifiers it allows us to tag products on pallet or box level as part of the receiving or picking process in order to improve internal productivity and quality. Key thing is you can do it without having to divest all your bar code readers and scanners. Not all processes have to be RFID’d.

So we are now climbing up the slope of enlightenment and see numerous success stories emerge, along with more packaged solutions. Sustaining RFID software pioneers, like Texas-based Globe Ranger (http://www.globeranger.com/), Finnish RFID specialist Vilant (http://www.vilant.com/),  can show several impressive projects and implementations, ranging from manufacturing to asset tracking and logistics operations. Just as important is that hardware vendors like Motorola, Intermec, Nordic ID, Alien and others continue to invest in hybrid solutions that allow RFID in combination with bar code scanning.

In EMEA, several compelling cases stem from green logistics initiatives, with a push for systems that rotate load carrying assets back into production for re-use. So freight companies, 3PLs, manufacturers and distributors can get great payback (and goodwill) by implementing RFID tag inlays in plastic pallets, roll cages and totes.

But these bigger system initiatives takes time, so my simple advice is now to seek ROI from a project isolated to your own operation (DC, warehouse network or store network) and start up with RFID tags coexisting with bar codes. Think of processes where you struggle using bar code scanning - don’t think compliance only, think what it can do for increasing productivity and quality.  

 I bet you can build a decent business case if you want to!

Agree or disagree? Share your thoughts on RFID and process automation!

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