Businesses miss benefits of high-tech radio tagging

22 January 2004
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22 January 2004 | Simon Binns

Many companies are unable to reap the full benefits of radio frequency identification (RFID) tagging, which allows more sophisticated tracking of goods through electronic scanning.

Experts believe these benefits include greater visibility and efficiency in the supply chain. They have prompted manufacturers such as Harley-Davidson and retailers such as Wal-Mart, Asda and Marks & Spencer to introduce RFID.

However, RFID requires significant technological investment before an organisation can begin to reap the benefits.

John Davison, a retail analyst at GartnerG2 consultants, said: "RFID is a disruptive technology. It clearly has benefits, but most companies simply haven't factored in the appropriate integral business processes, such as ensuring your company has the right electronic tag reader for the appropriate RFID tags you use."

He added: "RFID will be hugely important in 2004, but is at a nascent stage, so many companies have been slow to educate themselves."

Davison said he believed a major issue for buyers of RFID is that no one system is suitable for all companies and their suppliers. In other words, there was no "killer application" that would work immediately.

He said RFID hardware or software should be purchased first and then the processes put in to support and run it (see Features, 8 January).


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