Radio frequency identification (RFID) adoption expected to drive improved inventory management, process efficiencies
Boston — April 7, 2004 — Manufacturers with mandates from retailers such as Wal-Mart and the Department of Defense (DoD) to implement radio frequency identification (RFID) systems in 2005 must begin now not only to ensure compliance but to avoid compounding risk, says a new report by Aberdeen Group, a research and consulting firm serving major corporate technology end-users around the world.
"To successfully pilot and implement the change, evidence shows manufacturers implementing RFID must start the process now," said Tom Ryan, vice president of value chain research at Aberdeen Group and author of the report. "Many are adopting a hold-back strategy, letting others solve the inevitable problems and pass on the knowledge they acquire. However, with the tight timelines for compliance, this strategy is exposing manufacturers to real compliance failure.
"RFID is an evolving technology with significant potential to differentiate the manufacturer," Ryan continued. "Compliance to the mandates is the beginning of the journey, not the end."
Aberdeen said many manufacturers are delaying RFID implementation, and doing only the minimum possible, concerned about margin erosion caused by the process. However, evidence reveals manufacturers that embrace the technology now will reap the most significant benefits.
The firm also said that because this kind of RFID is new in scale and scope, manufacturers must be willing to work through the challenges of a new technology, anticipate setbacks, and manage roadblocks. A strategy of waiting for others to solve early deployment problems will leave little room for meeting the compliance schedules.
The RFID in the Consumer Industries Benchmark Report offers manufacturers insight into how their peers are implementing RFID technologies and provides them with a competitive framework to find out their position in the industry.
Further, the report offers advice on how to pull through RFID compliance in order to reap the benefits the technology promises.
