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RFID anxiety rises as deadlines approach ... Analysts predict double-digit growth for business process management

In this Issue:

  • RFID Deadlines Approach
  • BPM Poised to Grow
  • In Brief/Eye on Open Source

    RFID Deadlines Approach

    Middleware could soften the blow of huge growth in data.

    Don't panic yet: Radio Frequency Identification (RFID) doesn't yet require the full attention of most IT shops. But it would be a big mistake to ignore RFID, all the same.

    Complacency is certainly not in order for Wal-Mart's top 100 suppliers or for firms that sell to the U.S. Department of Defense (DoD). Companies like Gillette and Procter & Gamble face a January deadline to put RFID tags on pallets and cases bound for Wal-Mart's Texas distribution centers. The DoD wants all pallets and cases affixed with RFID tags by January. The little tags emit short-range radio signals that identify the product; give time and date of manufacture; date, time, and location of the read point; and other items yet to be determined.

    It is a potential avalanche of valuable information that could prove revolutionary. "This can move us from a push to a pull model," says Kara Romanow, analyst with AMR Research in Boston, "a truly demand-driven supply chain."

    It also fuels fears that an influx of new granular data will overwhelm IT departments. "This isn't likely," says Pete Abell, principal at ePC Group, a consulting firm in Boston that specializes in implementation and integration of RFID hardware. "We've all heard scary stories... But, with the right middleware, you can select just the RFID data you want, and you won't need a massive new amount of storage hardware and software."

    RFID middleware is available from a variety of vendors. Pure plays that focus on just this issue include OATSystems, ConnecTerra, and GlobeRanger. In addition, warehouse management system (WMS) vendors Provia, RedPrairie, and Manhattan Associates, and ERP stalwart SAP, all offer some RFID-enabling software. Using the Savant standards developed by the Auto-ID center, these tools all enable users to winnow down RFID data as it gets funneled from readers to an edge domain station that, in turn, connects back to core enterprise software. Joshua Walker, analyst with Forrester Research, recommends going with one of the pure plays. "They have a single-minded focus on just this problem."

    Abell, however, warns that some of these vendors may not be around for long. "With companies like SAP entering the RFID middleware space, I don't have lots of hope for the smaller guys."

    A valid point, but Romanow says it may not be that relevant. "This is the year for pilot RFID projects. Implement a minimum compliance program, knowing that you will probably throw it away when you are ready to fully embrace the technology."

    Michael Dominy, analyst with the Yankee Group, also recommends a migration path to RFID that begins with compliance, and he says software won't be the biggest expense. "The biggest cost of RFID implementations will not be in technology, but in services. We think consulting and systems integration services will account for about 80 percent of RFID spending over the next two years."

    This news is good for firms such as Accenture and IBM Global Services, but this projection also makes the point that RFID is a highly customized technology. "You can't let early adopters work out the bugs and then assume you can reap the benefits," says Walker. "RFID is not something you can buy in a box."

    Meanwhile, as January approaches, those who face Wal-Mart's deadline are saying less and less. Procter & Gamble claims to be "in the beginning stages" of learning about RFID. "Gillette now sees this as a real competitive advantage," says Romanow, "and has scaled way back on what [it is] willing to say publicly about RFID."

    It is a silence pregnant with implication. Eric Gabrielson, director of worldwide RFID engagements for IBM Global Services, says enterprises across the supply chain, large and small, should start kicking the tires. "You don't have to spend a lot of money. You can start with small RFID pilots for your top few products. Don't wait for marching orders from Wal-Mart."

    Mark Leon [[email protected]] is a freelance business and technology reporter.

    — Mark Leon

    In this Issue:

  • RFID Deadlines Approach
  • BPM Poised to Grow
  • In Brief/Eye on Open Source

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